After loss of tax credits, WA sees a drop in insurance coverage

About 19,000 fewer Washingtonians enrolled in health insurance through the state's online marketplace amid the loss of federal subsidies.

The decline didn't appear to be as precipitous as feared. State officials had predicted 80,000 people would forgo coverage if Congress didn't extend the enhanced premium tax credits for those purchasing the policies.

But officials fear the drop could get steeper in the coming months as enrollees fail to pay premiums.

During open enrollment, which ran from Nov. 1 to Jan. 15, more than 290,000 residents signed up for insurance through the Washington Health Benefit Exchange. That's compared to 309,000 during this period the previous year.

The exchange is generally used by people who do not have access to health insurance through their jobs or from government programs, like Medicaid.

Exchange CEO Ingrid Ulrey said the drop in coverage "could've been much worse," but cautioned it's still a "pretty significant dip from last year."

"We're starting from a lower peak and we're going to go down further than we have in the past," Ulrey added. "People are going to see their bills and just say 'I can't do this.'"

The federal government was shut down for over a month last fall as Democrats demanded the extension of the tax credits that expired at the end of 2025 and Republicans refused.

"Republicans made tax breaks for billionaires permanent and cut health care to do it. Now, we are only just beginning to see the fallout of that decision," U.S. Sen. Patty Murray, D-Wash., said in a statement, referring to tax cuts Republicans included last year in their "big, beautiful bill."

Nationally, about 1.2 million fewer Americans signed up for marketplace coverage than in the previous year. These insurance policies are available under the Affordable Care Act.

Those who choose to go without insurance are more likely to be healthy, likely fueling premium hikes for those who remain insured, as the insurance pool would be less healthy overall and more risky for insurers.

State officials say Washington's efforts, including Cascade Care Savings for people who make up to 250% of the federal poverty line, helped mitigate the loss of the federal subsidies. More than 118,000 Washington Healthplanfinder customers are receiving this state premium assistance this year, up from 115,000 last year, according to the data released Friday.

But the state says this assistance won't be sustainable beyond this year, especially as other federal health policy changes take effect.

"We're in jeopardy for 2027, '28 and '29 and beyond," Ulrey said. "The hill that we're climbing is only getting steeper."

Rural counties, including Okanogan and Pacific, were hit hardest by the loss of federal tax credits.

Premiums for individual insurance bought on the Washington Health Benefit Exchange rose an average of 21%, due in part to the loss of the enhanced tax credits, which started during the COVID pandemic. This increase was in line with similar hikes nationwide.

Enrollees losing their enhanced tax credits could see monthly premiums double or triple. Or worse. Low-income lawfully present immigrants, like refugees and asylees, saw their average monthly premiums jump from $25 last year to nearly $500, Ulrey said.

The "big, beautiful bill" prohibits these noncitizens from accessing federal financial assistance for marketplace coverage.

About three-quarters of all enrollees on the exchange last year qualified for the federal tax credits, helping them decrease annual premiums by an average of $1,330. For seniors, those savings jumped to more than $1,900 annually.

Final enrollment figures are expected in the spring.