{"id":58939,"date":"2025-12-02T21:51:05","date_gmt":"2025-12-02T21:51:05","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/58939\/"},"modified":"2025-12-02T21:51:05","modified_gmt":"2025-12-02T21:51:05","slug":"health-care-sticker-shock-coming-for-450000-new-yorkers","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/58939\/","title":{"rendered":"Health care sticker shock coming for 450,000 New Yorkers"},"content":{"rendered":"

This story originally appeared in New York Focus, a nonprofit news publication investigating power in New York.\u00a0Sign up for their newsletter here<\/a>.<\/p>\n

A decade ago, Obamacare made it possible for Elizabeth and John to build a small business in the Hudson Valley: a fitness center for children and adults that now has 200 students. The husband-wife team was able to give up jobs that came with health insurance and buy \u201cmarketplace\u201d insurance with subsidies from the Affordable Care Act. They later switched to the Essential Plan, a generous state program that offers free insurance to 1.7 million low- and middle-income New Yorkers<\/p>\n

Now, changes to the ACA \u2014 driven by Washington budget cuts \u2014 are expected to drive up John and Elizabeth\u2019s health insurance costs by more than $10,000 a year.<\/p>\n

They\u2019re among the hundreds of thousands of New Yorkers who will face sharply higher premiums in 2026 due to the stalemate in Washington over federal subsidies, the tax and spending plan Republicans passed in July, and Hochul\u2019s plan to minimize damage to the state budget while protecting low income, legal immigrants who will lose federal subsidies. <\/p>\n

\u201cI don\u2019t like what\u2019s going on in Washington, holding our health care hostage,\u201d said Elizabeth, who, along with her husband, asked to be identified by their middle names to protect their privacy. \u201cSmall businesses rely on the affordability of insurance to keep going.\u201d<\/p>\n

Higher premiums are just the beginning of an expected
\nwidespread disruption to New York\u2019s health care system over the next two
\n years as Washington\u2019s budget cuts take hold. Even more dramatic are the
\n policy changes in store for January 2027, when work and extra
\neligibility requirements will kick in for the state\u2019s 6.8 million
\nMedicaid recipients. <\/p>\n

The state Department of Health estimates these changes will result in 1.5 million people losing coverage. <\/p>\n

\u201cIt would erase most of the progress we\u2019ve made since
\n2010,\u201d said Michael Kinnucan, director of health policy for the Fiscal
\nPolicy Institute, a liberal think tank.<\/p>\n

New York state has been creative in using the complex
\nregulations of the 2010 Affordable Care Act to offer free and low-cost
\nhealth care to millions of its citizens and legal immigrants. In fact, 44 percent<\/a>
\n of New Yorkers are enrolled in state-sponsored coverage. Fewer than 5
\npercent of New Yorkers are uninsured, down from 12 percent in 2010.<\/p>\n

Now, those gains are threatened by a series of changes to the ACA that Republicans passed in the One Big Beautiful Bill Act.<\/p>\n

The debate is still raging in Washington over whether to
\nextend Covid-era subsidies designed to keep health insurance costs low
\nfor some 24 million Americans. The government shut down for 43 days over
\n Democrats\u2019 demand to extend the subsidies beyond December 31 \u2014 and
\nRepublicans\u2019 refusal to do so. Eight Democrats agreed on November 10 to
\nvote with Republicans to reopen the government after Senate Majority
\nLeader John Thune agreed to put the matter to a vote in mid-December.
\nThe outcome is uncertain.<\/p>\n

But only 140,000 New Yorkers, or less than one percent of
\nthe state\u2019s population, receive these subsidies to buy private insurance
\n on the Obamacare marketplace. That\u2019s because New York has been more
\ngenerous than most states offering free or low-cost care through
\nMedicaid and the Essential Plan. In New York, most people who would
\notherwise buy insurance on the marketplace get free insurance through
\nthese programs instead. <\/p>\n

Whatever happens in Washington, 450,000 low and
\nmiddle-income New Yorkers \u2014 including Elizabeth and John \u2014 will face
\nsharply higher premiums or lose their health insurance entirely on July
\n1, 2026, as the state grapples with the budget cuts Republicans in
\nCongress approved last July. <\/p>\n

Elizabeth and John have always considered health insurance essential. Elizabeth has autoimmune and blood disorders that need regular monitoring and is at high risk for cancer.<\/p>\n

John had long dreamed of being a personal trainer. He started with a few clients in 2010, but continued working his his full-time job as a newspaper photographer so he could keep his health insurance. That insurance was particularly important after their first child was born and Elizabeth was laid off from her full-time job. <\/p>\n

\u201cThe business was successful and started to grow,\u201d Elizabeth recalled. \u201cBut there was always that thing hanging out there: you need your corporate job for health insurance. Before ACA, it was much more difficult for a family business to get insurance. The premiums were high and the coverage was pretty lame.\u201d<\/p>\n

That changed in 2014, when the Affordable Care Act established marketplaces where individuals could shop for insurance. It also subsidized the cost of monthly premiums with tax credits \u2014 making insurance affordable for small businesses and self-employed people.<\/p>\n

With the help of a broker, Elizabeth and John found a plan
\nthat worked for them. John could quit his job and devote his energies to
\n his business full-time. Elizabeth could continue working part-time.<\/p>\n

The monthly premiums for Obamacare were high at first \u2014
\nabout $1,600 a month. But those costs decreased as the couple\u2019s broker
\nhelped them shop for the best plan. Their premiums decreased further
\nafter Congress expanded the tax credits during the Covid epidemic in
\n2021.<\/p>\n

By 2023, they were paying about $600 a month with a $2,000
\nannual deductible for a \u201csilver\u201d plan \u2014 not the cheapest \u201cbronze\u201d plan,
\nnot the priciest \u201cgold\u201d plan. It seemed to be better and cheaper
\ncoverage than they had with insurance from their employers.<\/p>\n

Then, in 2024, their broker informed them they were
\neligible for insurance with no monthly premiums and no deductibles under
\n the state\u2019s Essential Plan. <\/p>\n

The ACA gave states big financial incentives to enroll more people in Medicaid \u2014 not just the very poor, but those nearing poverty as well, including many people in low-wage jobs. This expansion now covers more than 2 million of New York\u2019s 6.8 million Medicaid recipients, whose incomes go up to 138% of the poverty level: $21,597 for a single person or $36,777 for a family of three.<\/p>\n

The ACA allowed New York to create its own plan, known as the Essential Plan, with federal dollars that otherwise would help pay for marketplace insurance. <\/p>\n

The Essential Plan covers students who work part-time in retail sales, non-unionized construction workers, house cleaners, people who work irregular hours, and people who piece together several part-time jobs. It also covers 725,000 legal immigrants who don\u2019t qualify for Medicaid under federal rules that limit enrollment to permanent residents who\u2019ve had a green card for at least five years.<\/p>\n

Curiously, the Essential Plan has generated a budget surplus. That\u2019s because the state was able to provide care for less per person than the equivalent amount the federal government was giving in tax subsidies for private insurance. <\/p>\n

It costs less to treat younger and healthier people than older and sicker people. And, if you offer insurance for free or almost free, lots of young and healthy people sign up. The federal government\u2019s subsidies were based on the cost of private insurance for an older, sicker population, so the state had money left over.<\/p>\n

Faced with a surplus, the state expanded eligibility for the Essential Plan in 2024 to people making up to 250 percent of poverty, or $39,125 a year for a single person and $94,125 for a family of five. Elizabeth and John, who have three children, learned that they qualified for the state\u2019s plan \u2014 no monthly premiums and no deductibles.<\/p>\n

\u201cI have to say, if the Essential Plan is what Medicare- or Medicaid-for-all looks like for Americans, then we should all do it right now,\u201d Elizabeth said. \u201cNobody should blink an eye.\u201d <\/p>\n

At her doctor\u2019s recommendation, Elizabeth had her fallopian tubes removed to reduce her high risk of ovarian cancer. \u201cI probably wouldn\u2019t have done it if it had cost me $3,000, right? I paid a couple of hundred bucks, which I think in the long-term saves a lot of people a lot of trouble. If I don\u2019t get cancer, I don\u2019t cost the system millions of dollars.\u201d<\/p>\n

But Elizabeth and John\u2019s good luck with low-cost health insurance is about to come to an end. In July, Hochul plans to scale back eligibility for the Essential Plan to make up for the money the state is losing in federal reimbursements. The couple will then go back to the Obamacare marketplace to shop for insurance \u2014 and they\u2019ll likely pay much higher rates than they paid in 2023.<\/p>\n

The Republicans\u2019 budget bill, passed in July, put new restrictions on who is eligible for federal subsidies on the ACA marketplace \u2014 money that the state uses to fund the Essential Plan. Contrary to Republican claims<\/a>, undocumented immigrants have never been eligible<\/a>. But the new law also bans legal, permanent residents who have had their green cards for less than five years. That includes most of the 725,000 legal immigrants covered by the Essential Plan.<\/p>\n

This puts New York state in a bind. Under a 2001 state court order<\/a>, New York is obliged to offer health insurance to low-income legal immigrants. Without federal funding, the state would have to pick up the entire tab for their care. <\/p>\n

Hochul came up with a plan to preserve coverage for the poorest people in the Essential Plan \u2014 including nearly all of the legal immigrants \u2014 by rolling back eligibility for those who gained coverage in 2024. That includes middle-class families like Elizabeth\u2019s and John\u2019s. <\/p>\n

In September, Hochul proposed reducing the income limit for the state\u2019s free plan from 250 percent to 200 percent of poverty, $31,300 for a single person or $53,300 for a family of three. Families who lost coverage on the Essential Plan would be eligible to buy insurance on the marketplace, but the costs would be much higher.<\/p>\n

Hochul\u2019s plan, which must be approved by the federal government, would allow the state to use $8.9 billion in federal funds <\/a>now held in a trust fund. This money has accumulated because the federal funding formula generated more money than the costs of the Essential Plan. <\/p>\n

Elizabeth doesn\u2019t know exactly what her family\u2019s premiums will cost when they return to the marketplace in July, but the state\u2019s online calculator<\/a> suggests families in her income range will pay premiums of about $900 a month for a silver plan \u2014 or $10,800 a year \u2014 with a deductible of $2,400. That\u2019s about a 50 percent increase over what they paid in 2024 and a giant increase over their nearly-free insurance under the Essential Plan.<\/p>\n

\u201cWe\u2019ll cross the bridge when we come to it,\u201d she said with a sigh when asked how she would manage. \u201cThat\u2019s all you can do.\u201d <\/p>\n

Clara Hemphill was a writer for Newsday, where she shared the 1991 Pulitzer Prize for local reporting; a foreign correspondent for The Associated Press; and the founding editor of\u00a0InsideSchools.org<\/a>.<\/p>\n

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