As federal ACA subsidies lapse, blue states offer their own
A handful of states have moved to soften the blow of lapsed federal subsidies for health insurance premiums.
TL;DR
- California, Colorado, Connecticut, Maryland, Massachusetts, and New Mexico are implementing state-funded premium subsidies starting in 2026.
- These state subsidies are generally less generous than the expired federal enhanced subsidies but will help many consumers, especially those with lower incomes.
- The expiration of enhanced federal subsidies is expected to more than double average ACA health premiums for recipients.
- Enhanced federal subsidies previously allowed middle-income households (over 400% of the federal poverty level) to qualify for premium tax credits, a benefit now lost.
- New Mexico is the only state fully replacing the enhanced federal subsidies for its residents.
- Massachusetts is investing an additional $250 million into its state health insurance marketplace, ConnectorCare, capping deductibles, co-pays, and the cost of insulin and inhalers.
- Maryland's program will fully replace enhanced federal subsidies for those under 200% of the federal poverty level and replace half for those between 250% and 400%.
- California allocated $190 million for state subsidies for people earning up to 150% of the federal poverty level.
- Colorado is offering a maximum of $80 per month per individual enrollee, backfilling about 40% of lost federal assistance.
- Federal data suggests millions of households may drop health coverage due to the lapsing subsidies.