Impacts of expired tax credits are trickling down. In Arizona, ACA enrollment has dipped by 65,000

There has been a barrage of news events in the last few months but, let’s remember back to last year when the government was shut down.

Democrats insisted that Congress extend Affordable Care Act tax credits that lower health care costs for millions of Americans. Republicans refused, and the government reopened without a permanent extension of those credits.

Since, we’ve seen enrollment in the ACA plummet. Here in Arizona, it's dropped by an estimated 65,000 people. Without the tax credits, it just cost too much for a lot of folks and now, the impacts of that are starting to trickle down.

Ann-Marie Alameddin is president and CEO of the Arizona Hospital and Healthcare Association, and she joined The Show to talk more about what she’s seeing.

Full conversation

LAUREN GILGER: Good morning.

ANN-MARIE ALAMEDDIN: Good morning.

GILGER: OK, so how big are the declines that you're seeing in enrollment since these tax credits were allowed to expire?

ALAMEDDIN: So what we're seeing is over 400,000 people are enrolled in the health insurance marketplace in Arizona, and we've seen a decrease in this first quarter of 2026 of about 16%. ... So it's up 65,000 Arizonans who were on the exchange, the health insurance marketplace, are no longer.

And they're likely those 65,000 Arizonans are likely now uninsured.

GILGER: Uninsured. OK, so what does that mean for hospitals? You're looking at what we call uncompensated care.

ALAMEDDIN: Yeah, it's people without health insurance. And hospitals care about this because we want to make sure that people get the right kind of care at the right time, access to primary care, access to to their specialty care services. Because when people don't have access to care, they wait until it's an emergency, and they come to the emergency department where they are sicker when they haven't managed these chronic conditions.

So we want to make sure that people have that insurance coverage. And then, of course, if there's not a health insurance plan, there's not a payer. And so hospitals absorb that cost for that care of that patient.

GILGER: Right. So hospitals are not going to say, no, we're not going to treat you. Of course they're going to treat you. But you often will just not get compensated for that, care will not be paid for.

ALAMEDDIN: Exactly.

GILGER: So is this worse for rural hospitals? We know those are already kind of facing economic headwinds right now.

ALAMEDDIN: Yes. Well, I think all hospitals are facing economic headwinds with the One Big Beautiful Bill that was passed last summer. We have work reporting requirements for Medicaid. We have a reduction in supplemental payments to hospitals that start in October of 2027. And that's $6 billion over the next six years. So really significant financial impacts to hospitals, which really compromises hospitals ability to cover that uncompensated care.

Where hospitals are going to have to make hard decisions in terms of how do you balance your budget if you're not getting these supplemental payments anymore and you have a rise in those coming to the emergency department and to the hospital without insurance, hospitals are going to have to make tough choices in terms of balancing their budget.

GILGER: OK. And I want to talk about what those choices look like in a moment, but I know you're also watching some other changes coming from, you know, policy levels. The ACA enrollment drop is not the only thing.

We're also seeing major declines in Arizona in people enrolled in the SNAP program, Arizona's food stamp program. Like that adds up to 424,000 people it's being reported in Arizona who are no longer getting food stamps. That's the largest decline of any state. Why is that something you're watching?

ALAMEDDIN: Yeah, we are watching that very closely, and are really concerned. I mean, first and foremost, hospitals are concerned that patients and families and their communities have access to healthy food. You know, that's just foundational to being healthy as a person. So that's first and foremost.

But when you think about it, SNAP benefits have now work reporting requirements that are, have been in effect since September. And so the state is administering those requirements. And as a result, over 400,000 Arizonans have lost their food stamp benefits. Half of, over almost half of those are children.

GILGER: Children.

ALAMEDDIN: Yeah. So that it's just very high numbers and very concerning. But on the same hand, AHCCCS, our Medicaid agency, is going to administer work reporting requirements starting in January.

GILGER: Right.

ALAMEDDIN: And so we are watching what's happening with SNAP benefits and are very concerned that that would be a forecast of what's going to come for excess enrollment and eligibility.

GILGER: So if work requirements like this come into place and you see a similar kind of drop, what would that mean for hospitals in Medicaid?

ALAMEDDIN: Yeah, I think very difficult financial constraints on hospitals. I think if there is a rise in uncompensated care, we've already seen it with the enhanced premium tax credits going away, that's expiring. There's an increase in uncompensated care.

And then if in the same hand there's increase in, a decrease in AHCCCS enrollment, that's another category of people that just don't have access to health insurance, that don't have a payer source that don't have access to primary and specialty care that are coming to the emergency department when it's an emergency.

And so our ability to really weather that when you have this rise in uncompensated care because of these various sort of policy decisions that have been made by Congress and then that reduction in supplemental payment, which for Arizona hospitals is really the operating margin for those supplemental payments, really. So ... hospitals are operating essentially in the red.

GILGER: So this sounds like a perfect storm, kind of lots of different aspects coming together all at once that you're getting worried about.

ALAMEDDIN: Yeah, it's a perfect storm. It's also a one, two punch, I think, in many regards, because you have an increase in uncompensated care, increasing costs for hospitals, and then you have the reduction in supplemental payments in income to hospitals. And so hospitals are going to be faced with some very tough decisions in terms of how they balance their budget.

GILGER: Choose your analogy.

ALAMEDDIN: Yeah, right.

GILGER: So let me ask in the last minute here, you know, when hospitals are put into that position, like, what do you do? Where do you look for cuts? How do you balance these things? Are you going to see hospitals in especially rural areas closing?

ALAMEDDIN: So we certainly hope not. We're going to be doing everything we can as an advocacy organization. Next week we're going to D.C., we're meeting with our Arizona congressional delegation to really map this out so they see what's going to happen in their district in terms of their hospitals, the impact of access to care, what the numbers are looking like so that they're informed in terms of what this actually looks like in Arizona.

But then I think hospitals are forecasting and they're budgeting what the options are, reductions of service lines, reduction in force, labor. The highest cost for a hospital is their labor force. And yet our health care workforce is essential. You know, we need health care.

We've been working for years to really expand our health care workforce and nursing, etc., or, you know, not buying equipment, you know, not investing in that infrastructure that is really necessary for hospitals.

So it's certainly tough decisions, but we're really focused on the advocacy side so that we can really inform policymakers so that they can right the ship, so to speak.