If you buy your own health insurance on the Marketplace, you’re not alone – more than 642,000 Tennesseans do the same. And like many people, you may get help paying for your coverage through tax credits or “subsidies” that lower your monthly cost.
These tax credits work a lot like how employers help pay a portion of their workers’ coverage. But if you’re self-employed or your job doesn’t offer health insurance, these tax credits help make your plan more affordable.
But unless new federal legislation is passed, many Tennessee families like yours may lose part or all of their tax credits at the end of the year.
That means you may have to pay more for coverage. And for some people, the coverage may be too expensive to keep without the tax credits.
So, where do these tax credits come from?
The Affordable Care Act (ACA) always included “advance premium tax credits” to help more buyers afford coverage. Those tax credits were expanded in 2020 when Congress passed the American Rescue Plan.
- Before the expansion, only people earning up to 400% of the Federal Poverty Level (FPL) – that’s less than $62,600 for one person or $128,600 for a family of four – qualified for the tax credit.
- After the expansion, those families earning under 400% of the FPL started receiving a higher premium tax credit.
- And, working families making more than 400% of the FPL could also qualify for premium tax credits, making sure none of these qualifying families had to pay more than 8.5% of their income for a plan.
This expansion simply lowered the amount many families were paying for their ACA Marketplace plans.
But now, those tax credits could go away
If they expire, the number of people who qualify for tax credits could drop quickly. So, many people may have to cancel their coverage if they can no longer afford it without these tax credits. As a result, over 265,000 Tennesseans could be without coverage next year.
What might happen if you lose your premium tax credits?
Simply put, you’ll be responsible for more of the true cost of coverage. According to Keep Americans Covered:
- A typical U.S. family of four making $64,000 a year could see the part they pay toward premiums increase by roughly $2,600 per year.
- A similar family making $125,000 a year could see an increase of roughly $7,700 per year.
- And for a 60-year-old couple with an income of $80,000, their portion could skyrocket by $17,500 per year.
Here in Tennessee, where the average income per year is around $36,000, that cost increase could have a big impact on working families who know every dollar counts.
If you have a Marketplace plan but don’t get tax credits, will this still affect what you pay?
It could. Most people agree that health insurance is a safety net for financial stability. But, if the premium tax credits go away, many healthy people may drop their coverage once it becomes more expensive.
That leaves fewer people in the system – mostly those with more extensive health care needs. When that happens, health plans have to pay more in medical bills for each person who stays covered – which can raise premiums for everyone.
Last year, we paid out just over $837 million for the medical care our nearly 112,000 Marketplace members needed.
If fewer people are covered, claims costs don’t go away – they just get spread across fewer people.
What can you do when it’s time to re-enroll in your Marketplace plan?
- Tennesseans with Marketplace plans should visit healthcare.gov to ensure their income and other demographic information is up to date.
- You can also call us or work with a licensed broker during the annual enrollment period from Nov. 1, 2025 to Jan. 15, 2026 for help understanding your current plan or looking at options for another one.
When more people are insured, everyone benefits.
People can get earlier diagnoses and better treatment outcomes, with less strain on emergency rooms and the overall health care system. And healthy people are generally more productive which means our workforce can contribute fully to our communities and economy.
Simply put, health insurance coverage helps people stay healthy, working, and out of debt – which helps our economy thrive. These tax credits need to stay in place for our neighbors and our collective future.
Michael leads teams in product strategy for all commercial business, including health and wellness offerings, and has responsibility for individual and small group product lines.