The looming expiration of Affordable Care Act (ACA) tax credits could unleash widespread financial and operational challenges for hospitals and health systems. Unless Congress acts before year’s end, millions of Americans could lose coverage, pushing up uncompensated care costs and straining already thin hospital margins.
According to MedCity News, the enhanced ACA premium subsidies — first expanded in 2021 and extended through 2025 — have helped roughly 21 million Americans afford health coverage through the federal marketplace. Without renewal, premiums could spike an average of $800 per person annually, according to the Kaiser Family Foundation (KFF) .
Mounting Financial Pressure
Hospitals have seen measurable gains in coverage stability and revenue under the ACA’s expanded subsidies. Their expiration would reverse much of that progress — particularly in vulnerable rural regions. Renewing the tax credits isn’t just a political issue; it’s a frontline financial and operational concern for health systems nationwide.
Hospitals in states that did not expand Medicaid, such as Georgia and Texas, could be hit hardest. A Savannah Morning News analysis projects that Georgia alone could lose $1.6 billion in federal funding and up to 25,000 healthcare jobs if subsidies lapse. Rural and safety-net hospitals would likely bear the brunt as more patients lose coverage and delay or avoid care .
For hospitals nationwide, this could reignite a pre-ACA pattern of cost-shifting and higher bad debt. KFF’s ongoing literature review confirms that Medicaid expansion and ACA tax credits have reduced uncompensated care costs, strengthened rural hospital finances, and improved access to preventive services .
Policy Uncertainty Amid Open Enrollment
The crisis comes as open enrollment begins November 1, with the government still operating under a continuing resolution amid the federal shutdown. NPR warns that the uncertainty could trigger a “death spiral” in the ACA marketplaces — where fewer healthy enrollees drive up premiums and further erode affordability .
What Hospital Leaders Should Do
-
Model financial exposure: Identify how subsidy loss could affect payer mix and uncompensated care by service line and region.
-
Engage in policy advocacy: Coordinate with state hospital associations to urge Congress to extend or make the subsidies permanent.
-
Reinforce community outreach: Encourage patients to enroll or re-enroll before subsidies expire to maintain continuity of care.
-
Prepare operationally: Review charity care policies, revenue cycle strategies, and financial assistance resources in anticipation of higher uninsured volumes.