Update on Expiring ACA Tax Credits

This evening, the House approved H.R. 6703 by a vote of 216-211. The Republican legislation (H.R. 6703) included a number of reforms and $36 billion in deficit reduction but did not extend expiring tax credits that lower the cost of health care premiums for roughly 23 million individuals insured through Affordable Care Act (ACA) exchanges. Amendments to extend subsidies were offered by Republican moderates in committee but were blocked by Republican leadership.  

It is now inevitable that the enhanced ACA tax credits will expire at the end of the year. But, this is not the end of the debate on Capitol Hill. In many ways, the pressure to extend ACA tax credits will not heat up until January.  

Last week, we suggested the most likely outcome is that the credits will expire on the January 1 deadline followed by another effort to pass the subsidies in early 2026 (see below). It appears that the scenario we described is now playing out. We believe that the next attempt to pass ACA subsidies will begin as soon as Congress returns from the Christmas break. That effort will have a much higher chance of success.  

Below is a quick update on the latest.  

Discharge Petition in the House and Next Steps:

• Four Republicans joined Democrats on a House “discharge petition” today. 

• The procedure allows members to bypass the Speaker and force a vote on a bill if a majority of the House of Representatives signs the petition.  

• The petition now has the necessary 218 signatures.  

• After seven legislative days of inaction, any signatory can bring up the bill. 

• This means that the Democratic subsidy extension bill will be ready to be called up for a vote when Congress returns on January 6, 2026, or anytime thereafter. 

• The bill would be subject to a predetermined rule. 

• Under the rule, the bill is debatable for one hour and not subject to amendment.  

Legislative Details of the House Democrat Bill:

• The discharged bill was sponsored by Minority Leader Hakeem Jeffries (D-NY).  

• The bill would extend the current enhanced ACA tax credits for three years, through December 31, 2028. 

• Based on identical Senate legislation, the bill would cost $83 billion.  

• The extension does not include income caps or civil penalties for fraud. 

• The bill also continues to allow ACA plans in 25 states to fund abortions.

• If a House majority passes the bill, it would go to the Senate where there is no requirement for action. 

Possible Senate Pressure Points:

• The Senate is under no obligation to pass a bill, but there are external pressure points that could cause a deal to move in January.  

• January 15, 2026 is the end of the ACA open enrollment period.  

• January 30, 2026 marks the expiration of federal funding. 

• Both dates are potential deadlines for action.  

• Five of the nine largest ACA enrollment states include Texas, Georgia, North Carolina, Ohio, and Michigan. Each of these states holds a key Senate race crucial to Republicans in 2026.  

• Some Senate Republicans who supported the subsidies last week are expressing confidence in a January deal.        

State	ACA Enrollment Population	2026 Senate Election Situation
Texas	3,996,226	Senator John Cornyn (R) Running for Reelection (Likely R)
Georgia	1,510,852	Senator Jon Ossoff (D) Running for Reelection (Toss-Up)
North Carolina	975,110	Open Seat (Toss-Up)
Ohio	583,443	Senator Jon Husted (R) Running for Reelection (Lean-R)
Michigan	531,083	Open Seat (Toss-Up)