Let’s cut through the smoke and mirrors: the expiration of Obamacare subsidies this year has nothing to do with protecting healthcare. This is a blatant power play orchestrated by Democrats in a desperate attempt to cling to control.
Democrats scream that these expiring subsidies will trigger a healthcare crisis— soaring premiums and millions without coverage. Yet, here’s the reality: even with the subsidy losses, premiums are projected to increase by an average of $1,665, but the expiring subsidies account for merely four percentage points of that. In short, just $333.
Contrary to the Democrats’ narrative, the vast majority of Obamacare subsidies will remain intact. What’s really disappearing are the temporary boosts enacted during COVID, funded by taxpayer dollars. That’s all.
During the pandemic, federal support raised the average taxpayer share of premiums to a staggering 93%, with some enrollees receiving 100% coverage. Once these COVID-era enhancements fade, taxpayers will still cover a hefty 80%—a far cry from the 68% that was the norm back in 2014 when Obamacare first launched.
Individuals below the federal poverty line will still pay a mere $180 a year for a silver-tier plan, even as premiums have skyrocketed from about $3,200 to nearly $10,000.
Let’s not forget that it was Democrats who set the expiration date for these COVID boosts on December 31. Now, they propose to make them permanent at a staggering cost of nearly half a trillion dollars over the next decade.
At a time when national debt eclipses $38 trillion, this is sheer fiscal insanity.
Chuck Schumer warns that letting these credits expire will lead to bankruptcies and deaths. Nonsense. In reality, the loss of these so-called subsidies will not significantly burden enrollees or drive them out of healthcare. In fact, half of those enrolled in fully subsidized plans don’t even use them— filing zero claims in a year.
Why? Many don’t even realize they’re on Obamacare, often enrolled by unscrupulous brokers who take advantage of the system. They rely on alternative insurance or never seek medical care.
In many states, the numbers are inflated—enrollees reporting incomes between 100% and 150% of the poverty level double the actual figures.
This means billions are funneled to insurers to cover individuals who don’t access services. It’s a travesty, and insurance companies are the only beneficiaries.
Since its inception, health insurer stock values have outpaced the S&P 500, particularly through the pandemic’s subsidy expansion. Even if the COVID credits vanish, only half of the zero-claim enrollees will lose coverage—leaving taxpayers to shoulder the financial burden for phantom beneficiaries.
With fewer of these phantom enrollees, the average cost for those who do file claims will inevitably rise. This is why insurers will keep jacking up premiums to offset their increased costs.
Obamacare’s unsustainable structure creates a consistent financial drain on taxpayers. With the enrollees’ share of premiums capped, there’s no incentive for insurers, hospitals, or care providers to manage costs. Expect premiums to keep spiraling upward, with taxpayers covering the entire increase if Democrats get their way.
This is simply not a sustainable path for America. It’s wreaking havoc on the private market.
Republicans must stand firm against Democrat threats and allow these COVID subsidies to expire as initially intended. But that’s not enough. Lawmakers across the board must address the flaws within the entire program—whether that means reform or complete dismantlement—before it collapses under its own weight.
