ACA Premiums Double for Older Adults as Tax Credits Expire in 2026

The expiration of enhanced premium tax credits through the Affordable Care Act (ACA) Marketplace at the conclude of 2025 is poised to significantly increase healthcare costs for millions of Americans. For those aged 50 to 64, a demographic that already relies heavily on these marketplaces, the financial impact is expected to be particularly acute. The Kaiser Family Foundation (KFF) estimates that the average ACA enrollee who receives a premium tax credit will witness their payments roughly double for the same plan in 2026. This shift isn’t just a matter of increased premiums; it reflects a broader challenge for older adults navigating healthcare coverage as they approach Medicare eligibility.

Why Older Adults Rely on the ACA Marketplace

Approximately one-third of all Marketplace enrollees – around 8 million people – were between the ages of 50 and 64 in 2023. This age group often finds itself in a precarious position regarding health insurance. Many are still working, but frequently in fields that don’t offer employer-sponsored health plans, or are self-employed, or work for small businesses that may not provide comprehensive benefits. According to KFF, about 45% of direct purchase insurance enrollees in their early 60s are working full or part-time, while 35% are retired and 21% are not working due to disability, caregiving responsibilities, or other reasons.

The trend of later retirement, while increasing doesn’t negate the fact that many individuals retire earlier than planned, often involuntarily due to health issues, job loss, or physical limitations. A survey by the Employee Benefit Research Institute (EBRI) revealed that most early retirees do so for reasons beyond their control, with only two in five retiring because they sense financially secure enough to do so. As employer-provided retiree health benefits continue to dwindle – in 2025, only 27% of large firms offered such coverage to pre-Medicare retirees – the ACA Marketplace becomes a crucial safety net for those bridging the gap to Medicare eligibility at age 65.

Disproportionate Impact on Older Enrollees

The loss of enhanced premium tax credits hits older adults particularly hard for several reasons. First, premiums in the ACA Marketplace generally increase with age, meaning older enrollees already face higher costs. Second, a significant proportion of those aged 50-64 have incomes slightly above 400% of the federal poverty line (FPL), making them ineligible for any financial assistance once the enhanced credits expire. This income threshold was $62,757 for an individual in 2024.

The impact is a “double whammy” for this group: the loss of all federal premium assistance combined with an increase in unsubsidized premiums that is larger than for younger age groups. For example, a 60-year-traditional with an income of $65,000 could see their annual premium payments increase by over $10,000, consuming nearly 18% of their income. Without the enhanced tax credits, the average bronze plan could cost this individual 18% of their annual income, while silver and gold plans could reach 24%.

Understanding the Premium Landscape

In 2026, the national average unsubsidized premium for a 60-year-old is $11,625 for the lowest-cost bronze plan, $15,914 for the benchmark silver plan and $15,672 for the lowest-cost gold plan. These figures vary significantly by state, with Wyoming, West Virginia, and Alaska having the highest premiums, and Maryland, New York, and Massachusetts having the lowest. The expiration of enhanced tax credits and the resulting increase in premiums are also driving healthier individuals to drop coverage, further exacerbating the cost increases for those who remain in the marketplace.

Many older adults were already enrolled in the lowest-premium plans available to them, limiting their ability to switch to a more affordable option. In 2023, 64% of ACA Marketplace enrollees aged 50-64 not receiving cost-sharing reductions were enrolled in a bronze plan, 22% in a gold plan, and only 13% in a silver plan. Switching to a bronze plan with a much higher deductible could mitigate premium increases, but would also expose enrollees to significantly higher out-of-pocket costs should they require medical care.

What Does This Mean for Coverage Decisions?

The substantial premium increases will likely force many older adults to craft difficult choices. Some may opt for plans with higher deductibles and narrower networks to keep monthly premiums manageable, potentially sacrificing access to preferred providers or facing higher out-of-pocket costs when they require care. Others may forgo coverage altogether, risking financial hardship in the event of an unexpected illness or injury. The impact will be most pronounced for those who do not qualify for cost-sharing reductions, which help lower deductibles and copayments for lower-income enrollees.

The situation highlights the ongoing debate surrounding the future of the ACA and the importance of affordable healthcare access for all Americans. The expiration of the enhanced premium tax credits underscores the financial vulnerability of those who rely on the Marketplace, particularly as they approach Medicare eligibility.

Looking Ahead: Potential Avenues for Mitigation

The future of the enhanced premium tax credits remains uncertain, with ongoing political discussions about potential extensions or alternative solutions. States may also explore options to provide additional financial assistance to residents purchasing coverage through the Marketplace. Individuals facing significant premium increases should carefully review their options, explore all available subsidies, and consider consulting with a healthcare navigator or insurance broker to find the most appropriate coverage for their needs. Resources are available through HealthCare.gov and state-based marketplaces like New York State of Health.