Many of the most disastrous elements of Trump’s Big Beautiful Bill were designed to kick in only after the 2026 elections, sparing Republicans like Alaska U.S. Sen. Dan Sullivan and U.S. Rep. Nick Begich from facing the full impact of their votes to slash spending on Medicaid, food stamps and other social safety net programs.
But the hammer is already set to drop on the more than 25,000 Alaskans who directly buy health insurance.
That’s because enhanced federal subsidies for marketplace health insurance plans – a common source of coverage for small businesses and independent contractors (like your author from 2017 to 2021) – are set to expire by the end of the year. While Trump’s Big Beautiful Bill extended tax cuts for the wealthy, Republicans omitted an insurance extension from the bill. The expansion was approved by Congress in 2021, making marketplace insurance plans relatively affordable for middle-class families (we’re still talking about $500 to $1,000 in monthly premiums).
According to a report by the Alaska Division of Insurance earlier this year, low-income Alaskans would largely be spared from the expiration of the federal subsidy. It’d be middle-income Alaskans who would be hit particularly hard, with premiums expected to increase by as much as $881 a month for a single adult. A family of four could expect their insurance premiums to increase by $2,184 per month, and a pair of pre-Medicaid-age seniors could see rates increase by more than $4,000 a month – $48,000 a year.
“That’s pretty horrific for sole proprietors, individuals who are working, they have income, but they don’t have employer-sponsored insurance,” now-former Alaska Division of Insurance Director Lori Wing-Heier told lawmakers earlier this year.
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The scorching rate hike will make health insurance coverage simply unaffordable for many. Small businesses will struggle to afford health insurance for employees, and independent contractors may need to reconsider their independence if they want to access health insurance. That has health groups in Alaska, where health care is already the most expensive in the country, worried because more uninsured people means less preventive care and higher reliance on expensive emergency room care. And because hospitals have a duty to treat everyone who needs care, the cost for that care is expected to be passed on to others, raising costs for everyone.
“I do think it’s important to recognize that we should be seeing thousands of people likely lose coverage from this,” Jared Kosin, the president and CEO of the Alaska Hospital and Healthcare Association, told the Alaska Beacon.
Kosin also noted that during the years the enhanced subsidies were in place, insurance rates continued to skyrocket with an average annual rate increase of about 16%. He said that people will simply be priced out of insurance coverage altogether.
For Alaska U.S. Sen. Lisa Murkowski, who cast a decisive vote in favor of the legislation, that’s a concern, and she’s been working, without success, to reverse the problem she helped create. She’s proposed a straightforward two-year extension of the enhanced subsidies, but she’s found little support with either fellow Republicans or Democrats.
“If you are a 60-year-old couple (earning about) $82,000 in Alaska, you would be looking at a premium increase … without enhancements, of $44,556. My husband and I are over 60. Now, granted, we’re not on the exchange, but I have a lot of friends are in that category, and I don’t know very many of them that could swallow an additional $44,000 a year to pay for their insurance if they’re on the exchange,” she told the Alaska Beacon.
Democrats have conditioned their vote to keep the government open on a permanent extension of the subsidies, while Republicans like Sen. Sullivan have insisted that any extension needs to be paired with an unspecified set of reforms to the health care system to root out “those who have been abusing it.”
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As with many Republican claims about health fraud, there’s very little evidence that abuse is widespread or a key driver in the cost of administering the programs. Also, Sullivan’s insistence that the cost of the subsidies be offset is a position that was conspicuously missing when he voted to extend the tax cuts for the wealthy in the Big Beautiful Bill. Even though that measure had massive cuts to social safety net programs, it’s still expected to explode the national debt by more than $3.4 trillion.
Earlier this year, Alaska lawmakers asked the congressional delegation to work on extending the subsidies, warning that without the extension, Alaska’s already expensive health care system would become even more expensive.
“We know that health care costs, as they will increase, would jeopardize small businesses and entrepreneurship. We are facing a tough fiscal situation. Enhanced premium tax credits make health care more affordable with no cost to the state,” said Rep. Genevieve Mina, the Anchorage Democrat who authored the resolution as the chair of the House and Social Services Committee, during the floor debate. “And if these subsidies expire, we’ll see more people who are uninsured. We’ll see more people go on to Medicaid, which will cost more for the state, and additionally, we will see impacts to our economy and small businesses.”