A $4 Trillion Tax Cut, With One Big Omission: Your Health Insurance

Written by: Ronke Adepoju

July 16, 2025

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While Americans got a massive $4 trillion tax cut thanks to the “big beautiful bill” signed by Trump on July 4, one key benefit was left out – and it could hit millions right in the wallet.

What Was Left Out: A Break on Premiums

The new tax law extended many provisions set to expire in 2026. But one didn’t make the cut: enhanced premium tax credits that have lowered health insurance premiums for millions under the Affordable Care Act (ACA) since 2021.

These credits helped more than 22 million people – 92% of ACA enrollees – shrink their monthly insurance costs in 2024, according to health policy group KFF. But they’re set to disappear after 2025. “People will see a sharp premium increase on Jan. 1,” said Cynthia Cox, director of KFF’s ACA program.

• $705: The average savings per enrollee in 2024
• 75%+: Projected rise in premiums when credits expire
•  4.2 million: Americans who could lose insurance without the subsidies
• 12 million: Expected to lose coverage due to related $1 trillion in health program cuts

Combined, this would be the largest rollback of federal health support in U.S. history, according to KFF’s Larry Levitt.

How We Got Here

These enhanced subsidies began with the American Rescue Plan in 2021, expanding help to middle- and upper-middle-income households. Under the program:

• More people became eligible
• Premiums were capped at 8.5% of income for many
• Enrollment skyrocketed – more than doubling from 11 million in 2020 to 24 million in 2025

The Inflation Reduction Act extended those benefits through 2025, but they now face expiration with no extension in sight.

Who’s Most at Risk

The expiration will affect all recipients—but especially:

• Black and Latino Americans, who saw strong coverage gains
• Self-employed workers and small business owners, with limited access to group plans
• Lower-income households, for whom even modest premium increases could be unaffordable

The Wealth Break Takeaway

The tax cut headlines may be big – but for millions, health care costs could quietly skyrocket in 2026.

If enhanced subsidies expire, families could face hundreds – or even thousands – more in annual premiums, with millions losing insurance altogether. For investors and consumers alike, the result could be tighter budgets, slower consumer spending, and growing pressure on the health sector.