Rural hospitals could face more closures as health care costs are expected to rise after the enhanced subsidies for the Affordable Care Act expire on Jan. 1.
In 2021, Congress created an enhanced ACA tax credit to make health insurance more affordable as the COVID-19 pandemic dragged on. Lawmakers expanded who qualified for existing subsidies and increased the financial aid to those who were already eligible. The number of Americans enrolled in the marketplace more than doubled, going from around 12 million in 2021 to over 24 million by 2025, according to the Commonwealth Fund.
On Dec. 17, House Republicans passed a health care package without an extension of the expiring subsidies. Politico reports that House Republicans have said they will continue to negotiate a deal on the subsidies in 2026.
Health care policy experts say without the subsidies, many Americans will opt for cheaper insurance with a higher deductible or dump their health insurance altogether.
An analysis from KFF found that ACA premiums for over 24 million Americans are predicted to double starting in 2026, and, according to the Urban Institute, 4.8 million Americans could lose coverage.
“Depending on where you live, how old you are, and how big your family is, many people will be paying even thousands of dollars more per month,” Emma Wager, a senior policy analyst for KFF’s program on the Affordable Care Act, told the American Independent. “Even if you do receive some level of subsidy, you won’t be receiving the amount that you had previously gotten in 2025; you’ll be paying more.”
Wager said it isn’t just consumers who’ll be affected by the loss of the enhanced premium subsidies, particularly those who rely on rural hospitals.
“When you have rural hospitals that have very thin margins already, and they see a large portion of their patient population doesn’t have the ability to pay for services anymore, that could force hospitals to close,” Wager said.
According to reporting by the USDA Economic Research Service, 146 rural hospitals in the United States shuttered or were converted to non-acute health care clinics between 2005 and 2023, meaning they stopped providing inpatient and short-term care.
Wager said even if rural hospitals don’t close due to larger numbers of patients without insurance, people with insurance will be charged higher prices to offset the costs.
Zachary Levinson is the project director of the KFF project on hospital costs. He said it’s not simply the loss of the ACA subsidies that could affect the nation’s hospitals and patient care, but also the significant cuts that are coming for Medicaid and Medicare reimbursements under President Donald Trump’s One Big Beautiful Bill Act.
“If a hospital closes, it obviously doesn’t just affect the people who are coming in without insurance, but it affects everyone who is receiving care from that hospital,” Levinson said. “Similarly, if a hospital is struggling because it now has to cover a lot of the costs of these patients without health insurance coverage, that means that they might need to cut back their care in a variety of ways, either eliminating services, laying off staff, investing less in the quality of care they provide, canceling investments in new medical equipment or construction projects, which could also affect other patients that are being served at that facility.”
Wager said she’s mostly concerned for those Americans with chronic health conditions who cannot easily let their health insurance go.
“It’s easy for a healthy person to look at their premiums going up by thousands of dollars and say, ‘Well, it just doesn’t make financial sense. We’re healthy. We don’t need this insurance,’ which obviously is still a very hard decision, and not one that most people would make lightly,” she said.
“I think if you know that you are going to have expensive health needs going forward, you really don’t have any choice but to pay those increased premiums, and if you can’t afford them, then that means that you just don’t have the care that you need, you won’t have access to it. And that’s something that I think is the more human element to all of this.”