Millions of Americans Confront Rising Health Care Costs

As the government shutdown continues into its fourth week, millions of Americans are facing rising health care costs. This shutdown is now recognized as the second longest in U.S. history, impacting over 700,000 federal workers who are currently furloughed.

Health Care Crisis Amid Shutdown

In Maryland’s Prince George’s County, which is home to approximately 60,000 federal employees, local food banks are feeling the strain. Lines at these banks have stretched around blocks, highlighting the urgent needs of the community.

Impending Premium Increases

The central issue causing the shutdown is the expiration of enhanced health care subsidies at the end of this year. If Congress does not take action, millions could see their health insurance premiums spike by an average of 18% starting in 2026.

According to a recent Kaiser Family Foundation (KFF) survey, the average annual premium for a family with employer-sponsored insurance reached nearly $27,000 in 2025, marking a 6% rise from the previous year.

Impact of Subsidy Expiration

The enhanced subsidies were introduced as part of COVID-19 relief measures and later extended by the Inflation Reduction Act. However, these subsidies were always intended to be temporary. Without renewal, 24 million individuals currently benefiting from the Affordable Care Act marketplaces may face significant cost increases.

• Potential 18% hike in health insurance premiums.
• Average annual premium for family coverage: $27,000.
• Total enrollment in Obamacare marketplaces: 24 million.

Disproportionate Effects on Southern States

The growth in the marketplace enrollment has predominantly occurred in Southern states. Many of these areas are represented by Republicans, meaning that they could be disproportionately affected by the loss of subsidy support.

Drivers of Rising Costs

Health care costs are primarily driven by various factors including doctor visits, hospital stays, and prescription drug prices. Notably, newer medications for obesity treatment, such as Ozempic and Wegovy, are adding substantial expenses to health insurance plans.

Critiques of Affordable Care Act

Cynthia Cox, a director at KFF, acknowledged that the Affordable Care Act (ACA) can drive up costs for individuals buying insurance on their own. Prior to the ACA, individuals with preexisting conditions often faced denials for coverage. While costs might appear similar to employer-sponsored plans now, the expense is shared by employers in those settings.

Financial Strain Without Subsidies

If the enhanced tax credits are not renewed, consumers could see their monthly premium payments increase significantly—up to 114% on average. This would create additional financial strain for those already struggling to afford care.

As health insurance costs rise, the situation underscores the need for addressing the fundamental issues within the U.S. health care system. Without systemic change, many Americans will continue to rely on subsidies to make health coverage accessible.

With the current government stalemate, it remains uncertain how long these critical subsidies will be available.