Trump Signals Openness to Extending Obamacare Subsidies/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ President Donald Trump signaled a potential short-term extension of enhanced Obamacare subsidies, aimed at buying time for a broader health care overhaul. He rejected a previously floated two-year extension and reiterated support for direct payments through Health Savings Accounts (HSAs). The future of the subsidies, set to expire soon, remains politically contentious in Congress.
Obamacare Subsidy Extension Quick Looks
- Trump hints at possible short-term extension of ACA subsidies
- Rejects White House’s earlier proposal for two-year extension
- Advocates for Health Savings Accounts (HSAs) over insurer subsidies
- ACA subsidies set to expire by year’s end
- Proposal mirrors Sen. Bill Cassidy’s conservative HSA-driven approach
- HSAs can’t cover premiums but may offset deductibles/copays
- Enhanced subsidies initially passed by Democrats during COVID-19
- CBO estimates 10-year subsidy extension would cost $350B
- GOP divided over extending subsidies amid rising premiums
- Trump claims some Democrats support his HSA-based health plan
Deep Look: Trump Opens Door to Short-Term Obamacare Subsidy Extension
WASHINGTON, D.C. — President Donald Trump opened the door Tuesday to a potential short-term extension of Obamacare subsidies set to expire at the end of the year. Speaking aboard Air Force One, Trump indicated such a move could serve as a stopgap while Congress works out a broader, Republican-favored overhaul of the Affordable Care Act (ACA).
“Some kind of an extension may be necessary to get something else done, because the unaffordable care act has been a disaster,” Trump said, criticizing the ACA by its formal name while leaving open the possibility of a limited extension of federal aid.
This marks a slight shift in messaging. While the White House had floated a two-year extension of enhanced ACA subsidies earlier in the week, Trump firmly rejected that timeline.
“Somebody said I wanna extend them for two years. I don’t want to extend them for two years. I’d rather not extend them at all,” he stated.
Rethinking Federal Aid: From Insurers to Individuals
Trump reiterated his support for a plan that would redirect federal funds away from insurance companies and instead give direct financial assistance to individuals via Health Savings Accounts (HSAs). “Don’t give any money to the insurance companies. Give it to the people directly, let them go out, buy their own health care plan,” he said.
While this approach aligns with conservative principles of consumer choice and market-driven health care, there are limitations: HSAs cannot be used to pay insurance premiums, though they can cover deductibles and co-pays. Thus, such a plan may not fully offset the average 114% increase in premiums that Americans could face when the current subsidies expire.
The White House Proposal That Wasn’t
The Trump administration had drafted a proposal that never reached the public. It included:
- A two-year extension of enhanced subsidies
- New eligibility limits, including income caps
- Elimination of free health plans for some lower-income Americans
- A partial tax credit payout for those choosing high-deductible health plans and opening HSAs
That model was heavily inspired by Sen. Bill Cassidy’s Republican framework, which emphasizes personal responsibility and consumer-driven care. Trump appeared to remain supportive of Cassidy’s vision but avoided embracing the full two-year extension.
Partisan Divide and Political Chess
Trump also claimed that his HSA-driven proposal has found support among some Democrats, although no Democratic lawmakers have publicly confirmed any involvement.
“I can’t tell you who, but we have — a lot of Democrats want to see this plan happen,” he told reporters.
Democrats originally passed the enhanced subsidies in 2021 under President Joe Biden’s leadership to reduce insurance premiums during the COVID-19 pandemic. The subsidies:
- Lowered or eliminated premiums for many low-income individuals
- Extended financial aid to those earning over 400% of the federal poverty level
- Were renewed in 2022, but scheduled to expire at the end of 2025 due to budget constraints
If not extended, the subsidies will revert to 2010 ACA levels, leading to significantly higher out-of-pocket costs for millions of Americans.
The Congressional Budget Office (CBO) estimates that a full 10-year extension would cost approximately $350 billion, adding complexity to the debate for fiscally conservative lawmakers.
Republicans Search for Direction
On Capitol Hill, Republicans remain split over the issue. Some acknowledge the risk of skyrocketing premiums if the subsidies lapse, while others remain firmly opposed to any measures that prolong the ACA.
Earlier this month, Senate Republicans agreed to a December vote on the subsidy extension as part of a larger deal to keep the federal government open. However, Trump’s lukewarm stance on the issue has left GOP lawmakers uncertain about which direction to take.
Many Republican legislators were caught off guard by reports that Trump might back a two-year extension and reportedly expressed frustration over the lack of clear guidance. In response, the White House shelved plans to announce the proposal on Monday, opting instead for a more cautious tone amid intra-party discord.
What’s Next?
The fate of Obamacare’s enhanced subsidies remains unclear as both sides of the aisle jockey for control of the health care narrative heading into an election year. Trump’s support for HSAs over traditional subsidies could shape Republican health policy moving forward — but for now, millions of Americans face the prospect of rising premiums unless Congress acts before the end of the year.
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