Enhanced tax credits that help thousands of Granite Staters better afford federally backed health coverage are set to expire at the end of 2025.
Without those credits, according to an analysis by the Kaiser Family Foundation (KFF), 46,000 current health care enrollees in New Hampshire are at risk, choosing between paying higher premiums or losing coverage altogether because they can no longer pay for it.
The original American Care Act (Obamacare) became law in 2010, and was expanded, through enhanced tax credits, as part of the American Rescue Plan Act in 2022. Those credits were extended through the end of 2025 by the Inflation Reduction Act.
Now, with a trifecta of Republican control in the U.S. House, U.S. Senate and the White House, that enhancement — indeed the original ACA itself — are at risk of cost-saving overhaul or even elimination.
U.S. Sen. Jeanne Shaheen, D-NH, is co-sponsoring legislation that would protect and permanently keep the enhanced tax credits.
“The numbers speak for themselves. The Affordable Care Act has record enrollment, benefitting millions of working-class families. But if the ACA’s enhanced premium tax credits expire, costs will increase across the country and millions of Americans would be at risk of losing coverage altogether,” said Shaheen.
“At a time when hard-working Americans are facing higher costs due to inflation, we should make every effort to lower prices where we can,” added the state’s senior senator, who joined U.S. Rep. Lauren Underwood, a Democrat from Illinois, in introducing the legislation to extend the tax credits.
In a statement, they noted that, through these credits, families of four who get their health care through the Affordable Care Act save an average of $2,400 on their annual health care premiums.
The credits, they said, helped boost overall enrollment in the ACA by 3.2 million new people in 2024. They called that “a historic gain in coverage,” noting that four in five Americans can now find health coverage for $10 or less per month because of the enhanced tax credits.
The enhancement made health insurance more affordable for middle-income families by raising the income threshold needed to earn the tax credits. For example, a family of four earning $135,000 (433% of the federal poverty level, or FPL) saved an average of $658 per month due to the enhanced tax credits. A 55-year-old couple earning $82,000 (401% of the FPL) saved an average of $1,152 per month.
The tax credits also come at a cost. The Congressional Budget Office, in a statement to the chairs of the U.S. House Committee on the Budget and the Committee on Ways and Means, estimates a permanent extension of the subsidies would cost $335 billion over the next 10 years.
To Jayme Simoes, a health care advocate in New Hampshire, it’s well worth the cost.
He depends on the tax credits to afford a higher tier of health coverage he needs because of a family member with eyesight issues.
“With the help of these tax credits, it lets us access that much more expensive plan, because it saves us money for the long run,” said Simoes. “We’re able to go see the eye doctor, the procedures that have to be done. It’s just a few hundred dollars a month, but it certainly helps; it meets our needs that we wouldn’t be able to easily access if it wasn’t for that.”
The Kaiser Family Foundation did an analysis by congressional district throughout the country of the impact of the loss of the enhanced tax credits.
“If enhanced subsidies expire, Marketplace enrollees making just above 400% of poverty will encounter the ‘subsidy cliff’ and would face the full price of a Marketplace plan,” it said. “If the enhanced subsidies expire, a 60-year-old couple making $82,000 (401% of poverty) would see their premium payment for the benchmark silver plan, on average, at least double in the vast majority of congressional districts.”
The subsidy cliff term was coined to describe people teetering on the edge of being uninsured because they have incomes that are too high to qualify them for subsidies under the ACA.
Tiers for health insurance plans offered through the Affordable Care Act marketplace are rated Bronze, Silver, Gold and Platinum and are priced accordingly.
In New Hampshire’s 1st Congressional District, according to the KFF data, there are 34,000 total ACA enrollees, 24,000 of them because of the subsidies. Without the subsidies, their premiums would increase an average 59% across all tiers of coverage.
Using the Silver tier as an example, a 40-year-old making $31,000 in New Hampshire’s 1st CD would see their premium rise 165%, from $58 to $153 per month. For a 60-year-old couple making $82,000 in this district, the premium would rise 138%, from $581 to $1,380 per month.
In New Hampshire’s 2nd Congressional District, 22,000 of the total 31,000 ACA enrollees take advantage of the subsidies.
The KFF analysis shows, for a 40-year-old making $31,000 in this district, the Silver monthly premium would increase 165%, from $58 to $153. For a 60-year-old couple making $82,000, the premium increase is 138%, from $581 to $1,384. Across all tiers, the average increase would be 61%.
“These credits help people who earn too much to qualify for Medicaid but still struggle to afford coverage. If they expire, many families will see significant increases in their monthly insurance costs,” said Phil Sletten, research director at the New Hampshire Fiscal Policy Institute (NHFPI).
Loss of the subsidies would ripple through the New Hampshire economy and state budget, according to Sletten.
“Workforce shortages and limited specialized services can make it difficult for people to get the care they need, even when they have insurance,” said Sletten. “If these tax credits are not renewed, state policymakers and health care providers will likely need to find other ways to reduce costs and help maintain access to coverage.”
