State by State: How much more will MINNESOTA residents pay if the enhanced ACA subsidies aren't extended?

It was in early 2021 that Congressional Democrats passed & President Biden signed the American Rescue Plan Act (ARPA), which among other things dramatically expanded & enhanced the original premium subsidy formula of the Affordable Care Act, finally bringing the financial aid sliding income scale up to the level it should have been in the first place over a decade earlier.

In addition to beefing up the subsidies along the entire 100 - 400% Federal Poverty Level (FPL) income scale, the ARPA also eliminated the much-maligned "Subsidy Cliff" at 400% FPL, wherein a household earning even $1 more than that had all premium subsidies cut off immediately, requiring middle-class families to pay full price for individual market health insurance policies.

Here's what the original ACA premium subsidy formula looked like compared to the current, enhanced subsidy formula:

Unfortunately, the ARPA's subsidy enhancements included a major caveat: They were only in place for three years, originally scheduled to terminate effective December 31, 2023 (they were retroactive to the beginning of 2021).

The good news is that this sunset date was bumped out by another two years as part of the Inflation Reduction Act (IRA) passed in 2022. The bad news is that this extension is currently scheduled to end effective December 31, 2025. Needless to say, with Trump winning reelection and Republicans about to gain a trifecta, it's highly unlikely that the IRA's enhanced subsidies are going to be be extended further.

 I decided to run the numbers myself to get an idea of just how much enrollees real-world health insurance premiums are likely to increase starting in January 2026 if the upgraded ARPA/IRA subsidies expire at the end of 2025.

For this analysis, I'm using four household scenarios, at several different income levels for each:

• a 50-yr old single adult earning between $20K - $70K/year
• a 30-yr old single parent w/an 8-yr old child, earning between $20K - $90K/year
• a 40-yr old couple w/2 children age 15 & 12, earning between $40K - $130K/year
• a 64-yr old couple earning between $20K - $90K/year

I should give a shout-out to KFF's Subsidy Calculator, which made it easier for me to run these calculations than trying to do so directly via HealthCare.Gov or the state exchanges would have been.

There's several caveats involved here.

• Both the Federal Poverty Levels (FPL) and average Benchmark Silver ACA premiums are as of 2025. For 2026, the first year that the impact of the enhanced subsidies ending would actually go into effect, FPL levels will be a bit higher, and the benchmark Silver premiums will likely be higher in most states as well.

• Benchmark Silver premiums vary widely from state to state, Rating Area to Rating Area, county to county and potentially even from zip code to zip code in some states. Not every plan is offered throughout an entire rating area, which can impact which Silver plan is considered the Benchmark for that area.

  I'm therefore picking a single zip code for each state...and I'm using the capital city of each state to do so. Note that the capital is also the largest city in some states but not in others.

• "Single Parent" and "Nuclear Family" scenarios: In some states, children under 19 are eligible for CHIP or Children's Medicaid at a significantly higher household income level (in some states they're eligible up to 200% FPL or more). These analyses don't take that into account.

• These analyses assume that the enrollees choose the benchmark Silver plan. In many cases they'd be better off choosing a Gold or Bronze plan (or even Platinum, although those aren't even available in most states).

• Finally, these analyses don't take into account the state-based supplemental financial subsidies available in about a dozen states.

OK, with all that understood, let's take a look (note: "infinity" simply means that the net monthly premium for that household would go from $0 (free) to some number higher than $0...which technically means their premium would increase "infinity percent" even if it only went from $0 to $1/month.

Instead of going alphabetically, I've decided to analyze the states from lowest to greatest net premium increases for the most dramatic case study (a 64-yr old couple earning just over the 400% FPL "Subsidy Cliff" threshold).

With that in mind, here's what it would look like in MINNESOTA:

Minnesota expanded Medicaid up to the 138% FPL threshold, and is also one of only three states (the other two are New York and, starting just a few months ago, Oregon) which has a Basic Health Plan (BHP) program in place for lower-income residents. BHPs are sort of a "bridge" healthcare coverage program between Medicaid and ACA exchange plans; in order to be eligible for a BHP in Minnesota you have to earn between 138 - 200% FPL. Minnesota's BHP program is called simply "Minnesotacare."

Because of this, the IRA subsidy impact is mostly irrelevant for the first two or three income brackets for all four households (the subsidies expiring actually would indirectly negatively impact the generosity of Minnesotacare in terms of what's covered, co-pays/etc, but it wouldn't impact who's actually eligible and the exact out of pocket cost impact is unknown, so that isn't shown here.

For enrollees earning more than 200% FPL, however, there would definitely be a clear impact, although it would be relatively modest for the first two examples (Single Adult and Single Parent). In both cases their net premium cost would increase by anywhere from 0% to 115%, depending on their income.

Meanwhile, the Nuclear Family would see their premiums jump by anywhere from 16 - 148%, while the older couple would see theirs jump by 18 - 132%. The largest hard dollar increase would be if they earned slightly over the 400% FPL threshold, where their monthly premium would jump from $638/month to nearly $1,500...a hike of over $10,000/year.

For what it's worth, Minnesota currently has around 78,000 residents enrolled in subsidized ACA exchange plans (plus 54,000 paying full price), plus another 103,000 in Minnesotacare and nearly 200,000 enrolled in Medicaid via ACA expansion.