As open enrollment begins, Arizonans see skyrocketing costs for ACA health plans

The federal government shutdown is now in its second month as Democrats continue to hold out for extensions to tax credits that help people afford health care through the Affordable Care Act marketplace.

This week, open enrollment for those Obamacare plans began, so Arizonans who rely on that health coverage can now see just how much higher their bills will be if the subsidies are allowed to expire at the end of this year.

More than 400,000 Arizonans get health care through the ACA marketplace. About 90% of Arizona enrollees also benefit from the soon-to-expire enhanced premium tax credits that keep their out-of-pocket costs lower. Without enhanced premium tax credits, people will pay about 114% more for coverage on average, according to the health policy research organization KFF.

Phoenix resident Sue Hutchison’s family enrolled in an ACA marketplace health plan after her husband retired. They are a few years too young for Medicare and earn too much to qualify for Medicaid. They have been paying a little under $500 a month for a plan that covers the couple and two of their sons. Hutchison said next year the same plan will be about $1,400 a month – more than a quarter of their income.

“We’re not happy,” Hutchison said. “We’re probably going to suck it up because I’ve had some fairly major health things happen this year and I don’t think we want to go without.”

Steve Gomez of Gilbert relies on the ACA marketplace because he’s self-employed. His son had a heart transplant as a baby and now has epilepsy. The plan Gomez’s family is currently on won’t be available next year, Gomez said.

“It’s just sucker punch after sucker punch,” Gomez said.

Gomez had already been paying more than $3,000 per month for health coverage because he opted to take the enhanced premium tax credits annually when paying taxes, rather than using the credits to lower his monthly costs.

The annual tax savings won’t be available anymore if the subsidies expire at the end of the year. And while the new health plan he’s considering for next year will have a slightly lower monthly cost than the $3,000 he pays now, Gomez said the new plan has many other drawbacks.

“It's a massively higher deductible — at $9,600 — and none of my son’s doctors are covered,” Gomez said.

A KFF poll last month found 78% of Americans support extending the tax credits, including nearly 60% of Republicans and more than 90% of Democrats.

Arizona Democrats, like Sen. Mark Kelly, continue to push to extend ACA subsidies.

“Donald Trump and Congressional Republicans have the power to stop these costs from going up,” Kelly told reporters Tuesday. “They can work with us to extend these tax credits.”

Extending the subsidies would cost the U.S. $350 billion over 10 years, according to the Congressional Budget Office.

Arizona Republicans, like Rep. Andy Biggs, argue the credits are too costly. And they say they were only meant to be temporary in response to the pandemic.

“You’re talking about the subsidy that came in for COVID relief,” Biggs told Arizona’s Family.

Hutchison and Gomez both said they plan to wait a few weeks to enroll in a health plan to see whether Democrats and Republicans can reach an agreement on the tax credits.

“I’m just watching the news, waiting and keeping my fingers crossed,” Hutchison said.