Dan Kline is a retired UAA professor who is expecting his Affordable Care Act monthly premiums to rise from about $192 per month with government subsidies to $1,733 per month because the U.S. government is drastically reducing subsidies that helped Americans buy health insurance in the pandemic and post-pandemic era.
Kline, who is a few months away from turning 65, has used the ACA for health insurance since COBRA coverage ended after he retired in 2021.
“This is for an out-of-pocket total of about $23,000 a year,” Kline said. Most recently, he paid $192 month, including dental and vision coverage with a $5,000 deductible. Starting Jan. 1, he expects to pay $1,773 per month without dental and vision plus a $6,300 deductible.
Karin Woofter is a financial professional with decades of experience who now helps people in the health, Medicare and Social Security space. She said the ACA is reverting to subsidies in place before the COVID-19 pandemic.
“They are just not as generous,” she said. “What will this mean for Alaskans who use the ACA who make more than 400% of the federal poverty level will be out of subsidy territory.”
In 2025, 400% of the federal poverty level is $62,600 for a household of one, $84,600 for a household of two.
In 2021, as part of a covid-era relief package, the ACA premium tax credits were enhanced to lower costs for previously eligible people and expand eligibility to people with incomes over 400% of the federal poverty level. But those modifications, which Congress extended in 2022, will expire at the end of 2025 unless Congress acts, according to KFF, a health care policy organization which also publishes health news. KFF reported that this year’s ACA open enrollment period, which started Nov. 1 in most states, is full of uncertainty and confusion for the more than 24 million people who buy health insurance through the federal and state Affordable Care Act marketplaces. For months, it has been warning that average out-of-pocket premiums for subsidized enrollees in the Affordable Care Act, also known as Obamacare, marketplace, more than double if the enhanced tax credits expire.
In Alaska, only two insurance companies are available to people in the ACA marketplace: Blue Cross/Blue Shield Premera and Moda health. This limits the choices of people in the ACA marketplace and likely contributes to the cost of the premiums.
Generation X shoppers, those born between 1965 and 1980, are in a tough spot in this enrollment period.
The worst scenario is someone in their 60s who is not on Medicare yet,” Woofter said. “There is the temptation to go without health insurance, but it's not a good gamble.”
Woofter added that medical debt is a leading cause of bankruptcy.
Enrollment for the ACA, also known as Obamacare, is the health insurance reform legislation that passed in 2010 during the Obama administration, began Nov. 1 and go through Jan. 15, 2026. The deadline is Dec. 15 for coverage to begin Jan. 1.
