Trump Administration Poised to Unveil Health Care Plan Amid Looming ACA Premium Hikes

The Trump administration is reportedly preparing to release a new proposal aimed at stabilizing Affordable Care Act (ACA) premiums for millions of Americans who depend on federal subsidies, according to a report by drydenwire.com on Monday. This move comes as significant increases in Obamacare premiums are anticipated for 2026, making health care affordability a critical issue ahead of next year's midterm elections.

This forthcoming plan seeks to address the financial strain on consumers, with Reuters reporting that it could include a two-year extension of ACA premium subsidies. However, new eligibility limits are also expected to be part of the framework, as detailed by Politico and cited by Reuters on Monday.

The urgency stems from the impending expiration of enhanced federal premium tax credits at the end of 2025, which could lead to substantial out-of-pocket cost increases for many enrollees. KFF estimates that without these subsidies, average monthly premiums for silver plans could jump by 26% in 2026, the largest increase since 2018.

A Peterson-KFF analysis from August 2025 indicated that ACA marketplace premiums are projected to rise by a median of 18% in 2026, with some average increases around 20%. This represents an 11-percentage-point jump from the previous year, driven by both the potential loss of subsidies and rising health care costs.

The political stakes are high, as health care affordability is a dominant concern for voters, according to a November 2025 survey by McLaughlin & Associates for Americans for a Balanced Budget. The issue has forced President Trump into a delicate balancing act between satisfying conservative calls to let subsidies lapse and addressing widespread voter anxiety over rising insurance costs.

Republican lawmakers are reportedly divided on how to handle the December deadline for the subsidies, with some pushing for an extension and others advocating for broader overhauls, Reuters noted on Monday. The administration's proposal aims to shape congressional negotiations, as Democrats have previously demanded subsidy restoration during government shutdown talks.

The potential for a "double whammy" of expiring subsidies and rising base premiums could see out-of-pocket costs for subsidized enrollees more than double, according to kff analysis from September 2025. This situation underscores the significant impact that federal policy decisions have on millions of Americans' access to affordable health coverage.

• Background on Enhanced ACA Subsidies: The enhanced premium tax credits, initially introduced in 2021 and extended through the Inflation Reduction Act, significantly lowered health insurance costs for millions. These subsidies are set to expire at the end of 2025, a deadline that has fueled the current debate and political maneuvering, as reported by kff in September 2025. Their expiration is a primary driver of the projected premium spikes.

• Projected Premium Increases and Affordability Crisis: Insurers have filed for substantial premium increases for 2026, with a median proposed hike of 18% and an average of 20-26% across the ACA marketplaces, according to August and October 2025 analyses by Peterson-KFF and KFF. Without the enhanced subsidies, out-of-pocket costs for many subsidized enrollees could increase by over 75%, potentially doubling for some, creating an affordability crisis.

• Political Implications for 2026 Midterm Elections: Health care affordability is emerging as a pivotal issue for the 2026 midterm elections, with a November 2025 poll by McLaughlin & Associates indicating that 73% of voters are concerned about rising premiums. The drydenwire.com report highlights that expected cost spikes have "bedeviled" President Trump and Republicans, who control both the House and Senate, making it a key electoral challenge.

• Trump Administration's Shifting Stance: Historically, President Trump campaigned on repealing and replacing the ACA, with unsuccessful attempts in 2017, as documented by KFF and Ballotpedia. However, the current proposal to extend subsidies, even with new eligibility limits, marks a notable shift, reflecting the political pressure to address rising costs rather than dismantle the system entirely, Reuters reported on Monday.

• Factors Driving Insurer Rate Filings: Beyond the expiring subsidies, insurers cite several factors for the 2026 premium increases. These include rising costs for medical services, the increasing expense and utilization of high-cost prescription drugs like GLP-1 inhibitors, general inflation, and labor costs, according to a Peterson-KFF analysis from August 2025. Insurers also anticipate that healthier individuals might drop coverage if costs rise, further impacting risk pools.

• Potential Impact on Coverage and Enrollment: The Congressional Budget Office (CBO) projects that if the enhanced subsidies expire, up to 4 million people could lose their health coverage, reversing recent enrollment gains, as noted by AJMC in October 2025. KFF also estimated in November 2024 that ACA enrollment could drop from 22.8 million to 18.9 million in 2026 without renewal of the subsidies.

• Alternatives Proposed by Republicans: Some Republican senators, including Bill Cassidy and Roger Marshall, have proposed alternatives to extending the current ACA subsidies. As reported by advisory Board in November 2025, their ideas include redirecting the expiring subsidy funds into health savings accounts or flexible spending accounts, aiming to give individuals more direct control over health care spending. President Trump has also suggested a direct payment plan to individuals.

• Broader Health Policy Context: The current debate is part of a larger, ongoing discussion about the future of health care in the U.S., with the Trump administration's "Project 2025" blueprint outlining potential significant changes to Medicaid and other health programs, as discussed by AFSCME and Brookings Institution. These proposals could lead to further shifts in coverage and costs, impacting millions of Americans.