Key Issue: Cost of Coverage
Spotlight on Affordability
80% of Pennsylvania’s uninsured are concerned about medical debt or financial crisis resulting from illness or injury, and 60% find Pennie’s plans unaffordable.
Pennie provides education on how premium costs affect Pennsylvanians, helping to shape health insurance affordability policies.
Maintaining Federal Premium Tax Credits
One of Pennie’s top priorities is ensuring health insurance is affordable so that all Pennsylvanians can access the coverage they need. Over the last few years, much has been done to address health insurance affordability and Pennie enrollment has increased by 30%. However, that progress is at risk without immediate Congressional action to keep Pennsylvanians covered.
Since 2014, the health insurance marketplace has been the source of premium tax credits to lower the cost of coverage. The premium tax credits were expanded in 2021 to make coverage more affordable and available to more marketplace enrollees – referred to as “enhanced premium tax credits.” Without federal Congressional action, the enhanced premium tax credits expire at the end of 2025.
The enhanced premium tax credits transformed accessibility to health coverage, particularly for low- and middle-income individuals, older Pennsylvanians, small business owners, and residents of rural communities. Around $500 million annually goes directly to reduce the costs of health coverage. Without this financial assistance, Pennsylvanians are expected to face unmanageable premium increases. The amount Pennsylvanians pay would increase by 81% on average, with many paying double, triple, or quadruple as much per month. For vulnerable populations—such as those nearing retirement, rural residents with limited coverage options, and low-income families—these savings are critical.
Enhanced premium tax credits have made affordable health coverage a reality for many Pennsylvanians for the first time. Without them, costs will rise sharply, forcing nearly half a million people to choose between their health and their financial security. Keeping these tax credits in place means Pennsylvanians can continue to access essential care and protect themselves from medical debt—benefits that ripple through our families, communities, and the entire healthcare system.
The Cost of Losing Enhanced Premium Tax Credits
Average Premium Increase by Income Level
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- Monthly costs for Pennie enrollees would increase by 81% on average.
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- Depending on income, some households would see their net premiums more than double.
Steep Hikes for Working Middle Class
While they make up a smaller share of Pennie enrollees, individuals earning over 400% of the Federal Poverty Level (about $60,000 annually) will face the steepest premium increases. These Pennsylvanians could experience net premium increases of double or quadruple what they currently pay.
The enhanced premium tax credits ensure no family pays more than 8.5% of household income for coverage through Pennie – this will increase to over 40% of household income for some families.
Consider these two couples:
Impacts to Entire Commonwealth
- Rural counties will experience a disproportionately high financial impact, as rural residents will lose more premium tax credit dollars than those in urban counties.
- Urban counties have more enrollees and are expected to have higher levels of disenrollment if the enhanced premium tax credits expire.
This map shows the average annual loss of advance federal premium tax credits per policy if the enhanced tax credits were to expire today.
What Pennsylvanians Are Saying
*click the arrows to view more*
What Pennie Is Doing to Help
Pennie is educating Pennsylvania policymakers and stakeholders on the expected impacts of losing the enhanced premium tax credits. Preserving them is essential to safeguarding the health and financial well-being of Pennsylvanians across the Commonwealth. More details and supporting data can be found in the documents below.
Enhanced Premium Tax Credits PA Impact
Impact of the Enhanced Premium Tax Credits in Pennsylvania Data
Establishing a State Health Insurance Affordability Program
Since opening our doors in 2021, Pennie has consistently heard that cost is a primary barrier to coverage for many uninsured Pennsylvanians. Pennie’s research shows that many uninsured individuals find health coverage to be unaffordable, despite the availability of federal tax credits. (Learn more: Pennie Uninsured Survey) These insights highlight the critical need for the Commonwealth to explore additional cost-assistance measures.
Pennie has partnered with state lawmakers to explore ways to reduce the cost of health coverage. As part of the 2024-2025 Pennsylvania State Budget, Pennie gained the authority to establish the State Health Insurance Exchange Affordability Program. Once funded, this program will provide premium assistance to eligible Pennsylvanians, making coverage more affordable. Pennie continues to engage with lawmakers and stakeholders, highlighting the importance of funding this program and the significant benefits it will deliver to Pennsylvanians.
How The State Affordability Program Helps:
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- Increases economic and financial security for individuals across Pennsylvania.
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- Improves health outcomes for enrollees with better and more consistent access to medical care.
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- Strengthens the individual health insurance market by improving the risk pool.
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Learn more about what our partners are saying about the need for a state subsidy program:
https://pahealthaccess.org/pa-organizations-release-letter-in-support-of-pennie-subsidies/