House Reconciliation Bill Brings Red Tape in the Marketplace and Leaves Millions Uninsured 

June 9, 2025

Nearly 23 million Americans rely on the Marketplace to access preventive care, manage chronic conditions, fill prescriptions and much more. The Marketplace provides coverage options for small business owners, young people striking out on their own, older Americans preparing for retirement and millions of others seeking affordable health care. But proposals in the recently passed House budget reconciliation bill jeopardize this private insurance option. Up to 8 million people could lose coverage because of changes to the Marketplace, including the failure to extend enhanced premium tax credits, according to the independent Congressional Budget Office (CBO).  

As the Senate takes up this legislation there is an opportunity to protect working Americans by ensuring this private insurance market remains a viable option.  

The Marketplace was designed to be affordable. For lower-income individuals, it provides financial assistance, crucial for allowing all Americans to shop for coverage. Today, 93 percent of consumers on the Marketplace rely on tax credits to reduce the cost of their insurance premiums. Proposed eligibility and enrollment requirements in the House-passed bill put tax credits out of reach, threatening access to care for Marketplace consumers.  

Rather than continuing to automatically re-enroll consumers eligible for tax credits using existing trusted data sources, the bill requires consumers to annually estimate their income for the upcoming year to verify eligibility. Automatic re-enrollment works because the Marketplace already has systems in place to check eligibility and reconcile tax credits from the previous year. Notably, neither Medicare nor the employer-sponsored market imposes this extra layer of red tape. 

The House-passed bill additionally no longer permits consumers to qualify for provisional eligibility, which currently allows individuals to receive tax credits while eligibility is confirmed. This includes any time a consumer has a change in circumstances such as a new child, divorce or reduced wages.  

Provisional eligibility serves as an essential bridge for consumers at a time of particular vulnerability. Without this bridge, Marketplace enrollees will be forced to pay full price on their monthly premiums while eligibility is verified. In the case of a newborn, for example, it could take months to secure the right paperwork. For many families, the wait will simply be too long. 

It’s not only what the bill includes that risks destabilizing the Marketplace and limiting access to care, but also what the bill excludes. Enhanced premium tax credits expanded the scope of Marketplace tax credits and brought health care into reach for millions more Americans. Failure to extend these enhanced tax credits by the end of 2025 would impose unsustainable cost increases on millions of families, accounting for over 4 million of the 8 million people projected to lose coverage as a result of the bill’s Marketplace changes, according to CBO. 

Consumers losing coverage results in poorer health outcomes and higher spending for the public. Individuals who are uninsured tend to use less care, worsening chronic conditions. And when individuals who are uninsured do use care, those costs are absorbed by the public through strained state budgets and higher premiums for all. Analysts estimate that the expiration of the enhanced tax credits alone could increase spending on uncompensated care by $78 billion.  

A functioning individual market keeps Americans healthier, keeps costs down and keeps providers and hospitals open to treat the most vulnerable among us. Without major changes from the Senate, the House bill would jeopardize affordable coverage and care for millions of Americans, raise costs for all consumers and make America sicker.