Senate rejects healthcare plans as ACA subsidies expire

The Senate voted on competing healthcare plans Dec. 11, 2025, as part of a deal to end the 43-day shutdown that ran from Oct. 1 to Nov. 12, 2025. That was the longest shutdown in U.S. history, surpassing the 35-day 2018-2019 shutdown. Democrats had refused to support continuing resolutions without guaranteed ACA subsidy votes. The compromise allowed the shutdown to end Nov. 12 with Senate Republicans promising a Dec. 11 vote on both parties' healthcare proposals.

The Democratic proposal for a three-year extension of enhanced ACA premium tax credits (Lower Health Care Costs Act) failed 51–48. It needed 60 votes to overcome a filibuster. Four Republicans crossed party lines to vote yes: Susan Collins (Maine), Josh Hawley (Missouri), Lisa Murkowski (Alaska), and Dan Sullivan (Alaska). The bill would've cost $89 billion over three years but insured 8.5 million more people by 2029, according to CBO estimates. Without the subsidies, average marketplace premiums doubled on Jan. 1, 2026.

The Republican alternative structured around Health Savings Accounts also failed 51–48. The plan would've provided $1,000–$1,500 per year in tax-advantaged HSAs for individuals earning under 700% of federal poverty level (about $100,000 for a family of four). But HSA contributions can't be used to pay monthly premiums—only out-of-pocket medical expenses after meeting deductibles. With average marketplace deductibles around $7,000 and monthly premiums averaging $584, the HSA amounts would've covered a fraction of actual healthcare costs.

Democrats unanimously rejected the Republican HSA proposal because it included restrictions prohibiting HSA funds from being used for abortion services or gender-affirming care. The bill also would've sunset the ACA individual mandate penalty (already reduced to zero by the 2017 tax law) and eliminated cost-sharing reductions for low-income enrollees. Senate Minority Leader Chuck Schumer called the proposal "woefully inadequate" and "a cynical political stunt designed to fail rather than a serious healthcare solution."

An estimated 22 million of the 24 million Americans enrolled in ACA marketplace plans received enhanced premium tax credits. These subsidies, expanded during COVID-19 under the American Rescue Plan and extended multiple times, capped premium costs at 8.5% of household income for all enrollees regardless of income level. Without the subsidies, a middle-class family of four earning $100,000 annually saw premiums jump from about $800 monthly to $2,400 monthly for the same silver-level plan starting Jan. 1, 2026.

The vote occurred with only three weeks remaining before the Dec. 31, 2025, deadline. Both House and Senate left for two-week holiday recess on Dec. 19, 2025, with no healthcare legislation scheduled for floor votes. This meant the subsidies would almost certainly expire, causing immediate premium increases starting Jan. 1, 2026. Insurance companies had already filed 2026 rates assuming subsidies would expire, so restoring them retroactively would require months of recalculation and regulatory approval.

The House subsequently passed a bill Dec. 19, 2025, to extend enhanced subsidies for three years by a vote of 230–196, with 17 Republicans defecting to vote with Democrats. Senate Majority Leader John Thune stated there's "no appetite" for an extension in the upper chamber. The White House issued a vague statement promising a new approach to healthcare affordability but provided no specifics or timeline. An estimated 4.8 million people are expected to drop health coverage entirely due to unaffordability. Trump healthcare proposals during his first term failed repeatedly in Congress, including the 2017 ACA repeal effort that failed when Sen. John McCain cast the decisive no vote.