Marco Reyes has been freelancing in graphic design for nine years. He doesn't get employer health coverage — his clients are companies, not employers. He earns too much for Medicaid and too little to comfortably absorb what employer plans cost. For the past four years, enhanced ACA subsidies kept his marketplace premium at $180 a month. Manageable. Real. A decision he made when he went independent. His 2026 premium notice arrived in November. $412 a month, same plan, same deductible. He's one of 20 million people who built their lives around a subsidy that Congress let expire [2].
The Subsidy Cliff Is Already Here
The enhanced premium tax credits created by the American Rescue Plan in 2021 and extended through the Inflation Reduction Act expired on December 31, 2025. The political conversation about this has been almost entirely consumed by Medicaid — the work requirements, the coverage losses, the state compliance costs. Medicaid is important. But the individual marketplace collapse is happening simultaneously, affecting a different group of people, and getting about a tenth of the coverage it deserves [3]. Here's what the expiration looks like in practice: premiums rising 114% on average for current marketplace enrollees. The CBO projects 4 million people losing marketplace coverage entirely; the Urban Institute and Commonwealth Fund put the number closer to 4.8 million [2]. These aren't people falling off Medicaid — they're the gig workers, early retirees between jobs and Medicare, self-employed small business owners, and part-time workers whose employers don't offer coverage. They're the forgotten middle of American healthcare: too much income for the safety net, not enough for the full freight [4]. Covered California — the state's ACA marketplace, among the best-managed in the country — backfilled some of the lost federal subsidies for the lowest-income enrollees. It's a partial fix for a partial population. The rest are on their own.
