Healey unveils health insurance relief plan $250 million more for ConnectorCare after federal subsidies expired in '25

State House News Service

BOSTON - The state plans to pump an additional $250 million into heavily subsidized insurance offered through the Massachusetts Health Connector, in an attempt to staunch skyrocketing costs for middle-class Bay Staters, Gov. Maura Healey's office announced Thursday.

Federal enhanced premium tax credits expired at the end of December, creating turmoil for residents whose subsidies had protected them from steep premium hikes.

Healey's relief plan brings ConnectorCare funding to a total of $600 million, which the governor's office called the "largest state investment in the country."

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The extra state aid is intended to ensure that about 270,000 residents enrolled in ConnectorCare and making below 400 percent of the federal poverty level "will see little to no premium increases because of the expiring federal credits, while also lowering other out-of pocket costs like co-pays and deductibles," Healey's office said. That threshold applies to individuals earning up to $62,600 and families of four earning up to $128,600.

"This continued commitment means hundreds of thousands of Massachusetts residents can continue to afford coverage that's there for them when they need it, keeping them healthy and financially secure," Connector Executive Director Audrey Morse Gasteier said. "This commitment reinforces Massachusetts's standing as the state with the most significant investment in affordable coverage through the Afford-able Care Act Marketplace."

While showcasing her plan for the state to step in, Healey on Thursday continued to call on the federal government to "extend these federal credits so that people can afford the health insurance that they need."

The $250 million will come from the Commonwealth Care Trust Fund, Healey's office said. It's not clear how much money is currently in that fund.

State law says that money "credited to the fund shall be expended without further appropriation for programs administered by the commonwealth health insurance connector authority." The governor's office described her proposal as a "plan" and said she had "directed the Health Connector to sustain this increased investment." The fund receives money from employer contributions, transfers from the currently overburdened Health Safety Net Trust Fund, and revenue tied to penalties paid by residents who don't meet the state's health insurance mandate. Bay Staters must have insurance coverage that meets certain standards or face a penalty.

The infusion offers an "additional subsidy" for people enrolled in ConnectorCare plans designed for residents earning between 100 percent and 400 percent of the federal poverty level, Connector spokesperson Jason Lefferts said.

Healey said she directed the Connector to explore other populations that can benefit from heavily subsidized ConnectorCare. The Connector and MassHealth are also exploring other options to prevent coverage losses stemming from the One Big Beautiful Bill Act, which analysts warn could double the state's uninsured rate.

To highlight the impact of the $250 million plan, Healey's office used the example of a 45-year-old couple in Fall River who have two kids and make $75,000. They previously paid $166 monthly for the "lowest cost coverage," though that figure would have more than doubled to $452 with the expiring subsidies. With the new ConnectorCare boost, the couple will now pay $206 monthly.

Under a federal policy change not linked to the expiring tax credits, residents with legal status who earned below 100% of the federal poverty level lost their eligibility for ConnectorCare on Jan. 1. Healey's plan does not restore this ConnectorCare plan type, Lefferts said.

Due to the expiring tax credits, the Health Connector has said subsidized coverage would not be available in 2026 for households earning between 400% and 500% of the federal poverty level.

Open enrollment at the Health Connector wraps up on Jan. 23. As of last week, nearly 23,000 Bay Staters had terminated their coverage through the Connector this cycle, and 23,596 people newly signed up for plans.