Republicans face new pressure to extend expiring Obamacare tax credits

NBC News

02-06-2025

WASHINGTON — Kenny Capps is a cancer patient who has been battling multiple myeloma for a decade. A 53-year-old father of three children who lives in North Carolina, he was on the brink of losing his health insurance coverage due to rising costs — until Democrats passed an Obamacare funding boost four years ago.
'Thanks to the enhanced premium tax credits, we were able to keep affording insurance,' Capps told NBC News during a recent visit to Washington to raise awareness about the issue. 'It had almost doubled to the point of my mortgage at that time, so I was getting close to the point of having to make decisions as to whether I was going to pay my bills or have health insurance.'
Capps makes too much money to qualify for Medicaid. He falls outside the subsidy range originally set by Obamacare, also known as the Affordable Care Act. And his income hasn't been keeping up with the ever-rising cost of health care. 'Like a lot of Americans,' he said, 'I'm stuck in the middle.'
His fortunes changed when Congress capped premiums for a 'benchmark' plan to 8.5% of income.
'So thanks to that, I was able to continue treatment,' he said.
But there's a catch: That funding expires at the end of 2025, and the Democrats who passed it along party lines (first in early 2021, before extending it the following year) have since been swept out of power. The new Republican-led Congress has made clear it won't extend the money in the 'big, beautiful bill' it's using as a vehicle for President Donald Trump's domestic agenda.
Some in the GOP are open to a bipartisan deal to extend the funds. But it's far from clear Republican leaders will allow it, as many in the party want the funds to expire. Letting the money lapse would save the government tens of billions of dollars, but it would strip away coverage for about 5 million Americans, according to the nonpartisan Congressional Budget Office.
A new 7-figure ad campaign on ACA funds
A new coalition called Keep Americans Covered is seeking to dial up pressure on lawmakers to continue the funding, launching a new ad in a seven-figure campaign.
It features a woman named Jessica, a restaurant manager in Arizona whose daughter has a chronic illness. She says the ACA tax credits 'have been particularly helpful for our family' to help afford the coverage they need.
'We need Congress to take action now. It's vital for us,' she says in the ad. 'We need these health care tax credits passed today.'
The spot, first reported by NBC News, is set to run in Washington, D.C., and 12 states — including Louisiana and South Dakota, home to House Speaker Mike Johnson and Senate Majority Leader John Thune, respectively. The ad campaign will also run in other states like Maine, Alaska and North Carolina, which are represented by Senate Republicans who will be key to the fate of the funding. The coalition behind it includes AARP, organizations advocating for cancer patients and lobbying groups representing doctors, hospitals and insurers.
Sen. Thom Tillis, R-N.C., said he wants to strike a separate bipartisan deal with Democrats to extend the ACA tax credits.
'I think we should,' Tillis, who faces re-election in a purple state, said in an interview, warning that Republicans shouldn't settle for purely party-line votes. 'So we got — with the ACA subsidies and other things, we should start thinking about a stream of bipartisan bills that we can work on.'
But Sen. Mike Rounds, R-S.D., said the issue of the expiring funds proves that Obamacare costs more than the Democrats who enacted it claimed.
'There's been a facade out there about the entire program actually paying for itself, or having money to pay for it,' Rounds said. 'That's part of the reason why we've got such a deficit right now. So from my perspective, we will have to take a look at any of the expenditures right now for health care.'
Democrats seek to extend funds; GOP skeptical
Republicans have a complex relationship with the ACA, originally voting unanimously against it in 2010 and trying unsuccessfully for years to repeal it. They've abandoned that effort in recent years, succumbing to the law's growing popularity and mindful of the fact that their political fortunes are becoming more reliant on working-class voters in the Trump era. Still, the party has little interest in shoring up a signature Democratic achievement.
In a recent House Ways and Means Committee markup for the GOP bill, Democrats offered an amendment seeking to permanently extend the ACA money. Republicans rejected it on a party-line vote, 25-19. Notably, Rep. Brian Fitzpatrick, R-Pa., who represents a swing district, didn't cast a vote.
House Ways and Means Chair Jason Smith, R-Mo., who voted to sink that amendment, has floated the idea of a bipartisan deal at the end of the year to extend tax provisions with broad support. When asked if he's open to including ACA tax credits in such a bill, his office declined to comment.
But Congress may not have the luxury of time. Insurers are set to finalize rates for 2026 plans in September. Open enrollment begins in early November, at which point the rates for next year will be locked in and can't change based on legislative action.
The top lobbying group for insurers warned that the impacts of inaction on the ACA funding could include premium hikes for consumers, in addition to coverage losses.
'Fifteen million Americans — including more than 4 million who rely on the health care tax credits — could lose their coverage, and millions more could face substantial premium hikes,' said a spokesperson for America's Health Insurance Plans.
If so, the higher premiums and coverage rescissions would hit during an election year, creating a political vulnerability at a time when Republicans will be fighting to hold their congressional majorities.
Capps said he agrees that the current health care system and its funding streams are imperfect. But for now, he's pleading with lawmakers not to let things get worse for people like him.
'We need to at least kick the can down the road until we can figure out a better system,' he said. 'Taking away from them in the meantime is not a solution. It's a death sentence for some.'