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Will Republicans and Trump save Obamacare? Official Washington is focused on two things right now — Jeffrey Epstein and a looming government shutdown at the end of the month.
But behind the scenes, vulnerable Republicans are worried about another issue: Obamacare subsidies that are set to expire at the end of the year.
The Obamacare cliff is a pressing political problem. The boosted tax credits help Americans pay for health insurance purchased through the Obamacare marketplace. Letting the premium subsidies lapse could lead to more than 4 million people losing health insurance, according to the CBO. Longtime Trump pollster John McLaughlin recently said the issue would be the party’s “greatest midterm threat.”
Inflation and rising costs of living are already a looming political liability for the GOP heading into 2026. Republicans are also under heavy fire for the Medicaid cuts in the One Big Beautiful Bill. So the Obamacare cliff could make those problems worse.
Let’s be clear: Republicans are in charge of Washington, so if premiums go up or huge chunks of Americans lose their health-care coverage entirely, the GOP will get the blame. They privately acknowledge that.
A bill to avert a government shutdown at the end of the month is a potential vehicle to address the matter. An extension of the tax credits is the one concession Senate Democrats think they could potentially get in exchange for their votes.
But here’s the rub: At this point, Republican party leaders seem less than eager about extending these subsidies. “Incredibly unpopular within the conference, expensive, bad policy, etc.,” one senior House GOP leadership aide said of an extension.
Ways and Means Committee Chair Jason Smith (R-Mo.) bashed the subsidies in July and ruled out an extension without significant changes.
Senate Majority Leader John Thune indicated Wednesday there’s some interest within his conference on extending the credits, but he put the onus on Democrats to “come to us with a suggestion, a solution, about how to address it.”
A bipartisan deal on the Obamacare subsidies could help ease Senate passage of a government-funding bill, given that Democratic votes will be needed. But there’d likely be a significant dropoff in GOP votes. And if Republicans will only accept a short-term or limited extension, that might not be a deal worth taking for Democrats.
The White House hasn’t quite figured out its posture on the issue yet. But administration officials seem pretty firm that this can’t be addressed in a short-term CR. If President Donald Trump wants the subsidies extended, they will consider it in December.
By then, it may be too late. Those impacted will have already been notified that their premiums are skyrocketing since open enrollment for 2026 coverage starts Nov. 1.
Let’s discuss some of the political dynamics at play here.
1) This is news: A group of vulnerable House Republicans and moderate Democrats is introducing a bill that would extend the subsidies for a year, pushing the deadline beyond the midterms. This could cost around $24 billion, based on the CBO’s estimate last year.
Kiggans told us she supports an effort to “reasonably phase out” the boosted subsidies but Congress is “out of time” and needs a one-year patch to avert premium hikes. She spoke with Johnson about it on Wednesday during a Republican Governance Group lunch.
“Covid is over, we don’t need these same incentives that we’ve given people,” Kiggans told us. “But we can’t do it tomorrow. It can’t be just cold turkey.”
2) A group called American Advancement Inc. started running ads nationwide saying that extending the Obamacare subsidies is the way to “deliver on the promises that gave them the majority and protect Trump.” Here’s the ad in Maine targeting GOP Sen. Susan Collins.
Ads are also running targeting Thune in South Dakota and Johnson in Shreveport, La. Plus, they’re hitting GOP Sens. Shelley Moore Capito (W.Va.) and Jon Husted (Ohio), as well as North Carolina Republican Senate candidate Michael Whatley.
3) Democrats are going to spend the next few weeks trying to make this as politically painful as possible for Republicans.
Senate Democrats, led by Sen. Jeanne Shaheen (D-N.H.), have a new analysis from Georgetown University’s Center on Health Insurance Reforms. The report says insurers expect Obamacare enrollment to decline significantly if the subsidies expire. It also says the credits’ expiration and expectations that health costs will rise are driving premium hikes.
“Both sides recognize that we need to get something done, and I sincerely hope my Republican colleagues don’t stand in the way,” Shaheen told us.
