3 reasons your Obamacare premiums are going up next year

Updated Fri, Jun 6, 2025, 1:57 PM 4 min read

If you happen to be one of the roughly 24 million people in America who buy their health insurance through the Affordable Care Act’s marketplaces, you’re probably in for some sticker shock next year.

Many families could be on the hook for hundreds, and in some cases thousands, of dollars more in premium payments thanks to the expiration of Biden-era coverage subsidies. A little-talked-about change in the GOP’s tax bill could also bump up costs by ending a practice among insurers known as “silver loading,” which juiced the amount of financial help households could qualify for when buying a health plan.

Meanwhile, higher premiums and new red tape contained in the GOP’s bill are expected to push younger, healthier customers out of the market. As a result, carriers are already signaling their intention to raise their rates by more than usual next year to deal with the cost of a smaller and sicker customer base.

Here’s what you need to know about the potential triple whammy.

The Biden administration temporarily upgraded the Affordable Care Act (ACA) by offering insurance shoppers much larger tax credits to help them buy coverage. Those changes dropped some premiums to zero and decreased out-of-pocket costs for lower-income families, and for the first time, capped monthly payments for households earning more than 400% of the poverty line, limiting costs to 8.5% of their income.

The enhanced insurance subsidies are set to expire next year, which means premiums will spike. As the Urban Institute calculated last year, that could leave some lower-income households paying 80% more. People with incomes above 400% of the poverty line — $62,000 for an individual, or $128,000 for a family of four — will no longer receive any help. This year, that would have meant paying an extra $2,900, according to Urban’s calculations.

These changes are going to be particularly important for freelancers and small-business owners who tend to rely on the individual insurance market, as well as service industry workers who don’t receive health coverage through their jobs.

For most of this past decade, many marketplace customers have been able to get a free bronze plan or very cheap gold-level coverage courtesy of a quirk that developed after Trump tried to cut funding to Obamacare during his first term. Those days will likely soon be over, thanks to the new tax bill.

The backstory is a bit technical: Under the ACA, lower-income households who buy coverage from the marketplace get big discounts that shrink their out-of-pocket expenses like copays and deductibles. The federal government was supposed to pay insurers directly to cover these so-called “cost-sharing reductions.”