Obamacare subsidy spending has nearly tripled since 2019 after Biden and Congressional Democrats widened the number of people eligible to include those whose income is more than 400% of the federal poverty level.
With the federal government shutdown in its fourth week, there appears to be no urgency on part of Senate Democrats to relent on their blockage of legislation to fully fund the government at prior agreed-upon levels.
At the center of the impasse is Obamacare. No, Republicans are not trying to repeal Obamacare. Democrats in Washington are fighting to keep what are being called “enhanced premium tax credits”, which increased the amount the federal government subsidized marketplace premiums and expanded it to individuals and families who make more than 400% of the federal poverty limit.
These enhanced tax credits are actually direct payments from the federal government to health insurance companies for individuals who buy health insurance from an Obamacare marketplace if they are not covered by an employer-sponsored health insurance plan. They were implemented at the height of COVID-era spending during the Biden presidency, and much like most new spending at that time, was touted as temporary.
Left-leaning non-profit group KFF’s data shows spending on Obamacare premium subsidies have nearly tripled since 2019, with an estimated $144 billion spent nationwide on subsidies, for an average monthly premium credit of $550. The average premium payment in 2019 was only a few dollars less than in 2025, but enrollment has skyrocketed because of the expansion in eligibility. Since enhanced premium subsidies expanding the pool of eligibility were made law, the number of American enrolling in the Obamacare marketplace has doubled. Spending on premiums have increased 500% since 2015.
With the expiration of this temporary enhanced “tax credit”, Democrats in Congress have refused to agree to a spending package that will reopen the government without an extension of them. Democratic Leader Sen. Chuck Schumer recently claimed that 50,000 Americans will die without the enhanced premium tax credit, which kicked in nearly a decade after Obamacare was signed into law.
KFF claims premiums for individual-purchased marketplace plans “will more than double” if the enhanced premium subsidies are not renewed, referring to the amount individuals will have to pay without the support.
According to reporting at The Daily Signal, Republicans in Washington are largely intent on ensuring the temporary premium support ends. Senate Majority Leader John Thune (R-South Dakota) argued the extension is “direct subsidies to insurance companies” and that “it needs to be reformed.”
With the end of the enhanced subsidies approaching, Democrats believed they had a political opportunity to use the possibility of rising premiums to force Congressional Republicans to the table and negotiate a funding bill that included extending the premium payments. But the GOP isn’t budging; Sen. Rick Scott (R-FL) has argued that the spending on Obamacare has done the opposite of making healthcare and health insurance more affordable: “Look at how much this is all costing us. Obamacare was sold on a lie. The costs have skyrocketed.”
Congressional Republicans have gotten some back up this week, as a group of conservative leaders wrote to GOP leadership urging them to stay the course and not to give in on Democrats’ demands to spend more on Obamacare.
Critics argue the enhanced subsidies must not be extended and that Obamacare spending is out of control with rampant fraud. Meanwhile, proponents of increased public spending on private health insurance admit that Obamacare is expensive, but that health care is expensive across the board.
While Democratic leaders in Congress say they are resolved to continue fighting, there are signs that the Democratic coalition is starting to weaken as the American Federation of Government Employees has now come out in favor of Democrats relenting and voting to reopen the government.
