Gov. Ned Lamont and governors from 17 other states are calling on congressional leaders to extend federal subsidies that help more people afford health coverage through state-based insurance exchanges like Access Health CT.
The subsidies, known as enhanced premium tax credits, are set to expire at the end of the year. If they do, states will have to pick up the cost — or individuals will pay significantly more for health coverage.
The governors on Monday wrote to U.S. House Speaker Mike Johnson, Senate Majority Leader John Thune, House Minority Leader Hakeem Jeffries and Senate Minority Leader Charles Schumer, raising alarms about the impact of the expiring tax credits and urging congressional leaders to extend them.
Govs. Kathy Hochul of New York, Phil Murphy of New Jersey, Maura Healey of Massachusetts, Dan McKee of Rhode Island, Gavin Newsom of California, Tim Walz of Minnesota, Gov. Gretchen Whitmer of Michigan and others co-signed the letter.
“For millions of hard-working Americans, these subsidies are the only reason health insurance is still within reach in a country where the cost of living keeps going up,” they wrote. “If they expire, premiums will rise by thousands of dollars for many families, millions will lose coverage, and people will be forced to make impossible choices between paying for health care, rent, or groceries.
“Hard-working American families, older Americans not yet on Medicare, small business owners, and rural communities — where marketplace coverage is often the only option — will be hit the hardest. The timing couldn’t be more urgent.”
Nationally, if the subsidies expire at the end of the year, the Congressional Budget Office projects that more than 4 million people would lose health care coverage over the next decade, citing increases in out-of-pocket expenses because of more costly premiums.
The expiration of enhanced tax credits will lead to out-of-pocket premiums for ACA marketplace enrollees increasing by an average of more than 75%, with insurers expecting healthier enrollees to drop coverage, according to a Peterson-KFF analysis. That, in turn, drives up underlying premiums.
Connecticut residents who get insurance through the state health care exchange could pay an average of $1,700 more a year.
State officials would have to spend more than $295 million annually to pick up the costs of the enhanced premium tax credits if Congress fails to extend them, a spokesperson with Access Health CT said.
“Our entire health care system will be undermined by the failure to renew these premium tax credits,” U.S. Sen. Richard Blumenthal said during a press conference at the state Capitol on Friday. “Health insurance and these premium tax credits are absolutely essential to lowering the cost of health care.”
Blumenthal has co-sponsored federal legislation that would make the enhanced premium tax credits permanent.
Amid the changes in the federal health policy landscape and the expiring tax credits, the Connecticut Insurance Department last week approved double-digit rate increases for state-regulated health plans in 2026.
The department signed off on an average rate hike of 16.8% for individual plans and 11% on small group policies.
The plans collectively cover about 224,000 residents (158,000 in individual policies and 66,000 in small group). Insurance department officials said expiring federal subsidies were factored into the insurers’ requests for higher rates this year.
Across 312 insurers participating in the ACA Marketplaces from 50 states and the District of Columbia, the Peterson-KFF analysis shows a median proposed premium increase of 18% for 2026, about 11 percentage points higher than last year. This is the largest rate change insurers have requested since 2018, the last time that policy uncertainty contributed to sharp premium increases. On average, ACA Marketplace insurers are raising premiums by about 20% in 2026, the analysis found.
“Insurers are already setting 2026 rates. If Congress acts quickly, states can lock in lower premiums and spare families a wave of sticker shock this fall,” Lamont and the other governors wrote in their letter. “If not, the damage will be felt for years. This isn’t a partisan issue. It’s about protecting working people who are doing everything right but are still struggling to get by.
“Extending these tax credits is one of the simplest, most effective steps Congress can take to keep health care affordable and provide real stability for millions of families.”
While the subsidy extensions seemed to be on the table, Republican leadership recently indicated it wouldn’t be a part of negotiations.
But Democrats haven’t been the only ones pushing for the renewal of those subsidies, especially with the political reality that many Americans would lose coverage or face higher premiums at the start of the midterm election year in 2026.
Some Republicans have also been supportive of extending the tax credits, and a group in the House recently backed legislation before spending talks ramped up.