Iowa delegation wary of extending ACA tax credits as consumer advocates warn of steep premium hikes

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As Congress intensifies negotiations over whether to extend the Affordable Care Act's temporary enhanced premium tax credits, Iowa's congressional delegation remains largely skeptical — with most Republicans warning that extending the COVID-era subsidies risks deepening fraud, subsidizing wealthy households and insurance companies, and avoiding tougher structural reforms to lower health care costs.

Only one member of Iowa's delegation — U.S. Rep. Zach Nunn, R-Bondurant — has publicly backed a bipartisan proposal to temporarily extend the credits. Consumer advocates, meanwhile, warn that letting the enhanced tax credits expire would result in steep premium hikes for tens of thousands of Iowans who buy coverage on the individual federal marketplace.

"Increased health care costs would significantly impact Iowans across different income levels," said Phil Jeneary, executive director of Iowans for Affordable Healthcare.

Iowans for Affordable Healthcare (IAAHC) is a new, non-partisan organization focused on improving access to quality, affordable health care for Iowa families and businesses. Its mission is to be a constructive voice in policy discussions that impact the cost and accessibility of care across the state.

"For example, a family of four earning about 200 percent of the federal poverty level (about $64,000) would see their monthly health care cost increase by nearly $250," Jeneary said. "A couple making around 450 percent of the federal poverty level (about $95,000) would face a monthly rate increase from $652 to $1,659 — an increase close to $1,000. These increases could make health coverage much less affordable and may lead some Iowans to forgo necessary care or coverage."

An estimated more than 130,000 Iowans buy their coverage through the ACA marketplace.

Congress is currently in a race against a Dec. 15 deadline to prevent premium increases from taking effect for 2026 coverage. While Democrats are pushing for a vote on an extension, a bipartisan agreement still is uncertain.

Nunn backs two-year extension with income limits

Nunn has signed on as a co-sponsor to a bipartisan House bill that would extend the enhanced ACA premium tax credits for two years, while adding new income limits and creating new anti-fraud penalties. He has cast the bill as a way to provide short-term stability while Congress works toward broader changes.

"Health care continues to be one of the biggest concerns for Iowa families, especially when it comes to affordability and reliable coverage," Nunn said in a statement to The Gazette. "I support a bipartisan effort to offer short-term stability and prevent premium spikes while we work on more permanent solutions. But we can't ask taxpayers to keep funding a fundamentally broken system. Moving forward, I'm pushing for reforms that lower premiums, crack down on fraud, and hold insurers accountable."

Jeneary said his group is open to either a one- or two-year extension, including models like the one Nunn supports, but has not taken a position on the additional guardrails.

"We would support any proposal that extends those tax credits. So if that's a one year or a two year, as the President had kind of suggested, either way, I think that we would be supportive of any of those two proposals," he said.

On questions about new income limits and anti-fraud provisions, Jeneary said IAAHC has not endorsed specific policy changes but is not opposed to efforts aimed at program integrity.

Hinson points to fraud, pushes HSAs over subsidies

On a conference call with Iowa reporters Thursday, U.S. Rep. Ashley Hinson, R-Marion, said she wants bipartisan reforms focused on lowering premiums, improving access to care and protecting taxpayer dollars.

Asked whether Nunn's two-year extension paired with program integrity measures is a workable compromise, Hinson pointed to what she called fraud and misuse of subsidies.

"We have some incredibly wealthy folks who have been able to take advantage of a system that really should be used for working-class and vulnerable Americans," she said.

Hinson said her priority in the debate over ACA tax credits is ensuring that patients — not insurance companies — have greater control over their health care decisions. She argued that approaches modeled on Health Savings Accounts would direct assistance "into my constituents' hands" and better protect consumer choice while avoiding subsidies for high-income households or insurers. Hinson said she expects Congress will ultimately reach a bipartisan agreement.

Her office later emphasized that rising premiums are driven by broader cost pressures — including inflation, utilization and workforce shortages — and reiterated her support for HSA-style models. A spokesperson said such approaches improve consumer choice and "ensures we aren't subsidizing big insurance companies or contributing to rampant fraud, adding that Hinson remains engaged in bipartisan discussions.

Miller-Meeks: GAO report shows ACA 'riddled with fraud'

Hinson and other Republicans have leaned on a new Government Accountability Office report that found ongoing fraud risks in the advance premium tax credit program.

The report emphasizes that the covert testing is illustrative and cannot be generalized to all enrollees, and that unreconciled subsidies do not necessarily represent overpayments. But Republican members of Iowa's delegation have seized on the findings as evidence that the ACA subsidy system is "riddled with fraud."

U.S. Rep. Mariannette Miller-Meeks, R-Ottumwa, an ophthalmologist and former Iowa Department of Public Health director, has been one of the delegation's most forceful critics of extending the enhanced tax credits.

In a Facebook post, she said the GAO investigation "confirms what we've been sounding the alarm on for years — the 'Unaffordable Care Act' is riddled with fraud," calling it "a national disgrace" that must be fixed.

At a Nov. 10 town hall in Keosauqua, she argued the ACA's core premium tax credits remain in permanent law, but criticized efforts to continue temporary enhancements that extend subsidies to those earning more than 400 percent of the federal poverty level. She said the law has failed to deliver on promises to lower costs and argued enhanced subsidies flow "directly to profitable insurance companies" rather than patients.

In a statement to The Gazette, Miller-Meeks defended her approach to federal health policy and criticized the trajectory of the Affordable Care Act.

"More choices, lower costs, and high-quality care should be the promise of American health care, yet the Unaffordable Care Act has delivered the opposite: continually escalating premiums, shrinking options, and billions in subsidies for profitable insurers," Miller-Meeks said. "As a physician, I'm fighting for reforms that put patients and their doctors ahead of profits and create a system that truly serves those who depend on it."

Her office emphasized that Miller-Meeks is focused on lowering health care costs for Iowans, arguing that Democrats want to continue sending billions of dollars to insurance companies rather than addressing underlying affordability issues. Staff cited rising premiums and deductibles since the ACA's passage, as well as what they described as narrowing coverage options.

Miller-Meeks' office also pointed to ACA reform provisions included in Republicans' tax and spending package, which it said will save tens of billions of dollars and contribute to a 0.6 percent reduction in premiums, citing estimates from the nonpartisan Congressional Budget Office.

Feenstra stresses affordability, doesn't say if he backs extension

U.S. Rep. Randy Feenstra, R-Hull, underscored concerns about affordability for rural Iowans but did not directly say whether he supports extending the enhanced tax credits.

"As a former volunteer EMT for 15 years in my hometown of Hull, I want all Iowans to have access to high-quality, affordable health care," Feenstra said in a statement to The Gazette. "The reality is that too many Iowa families, farmers, seniors, and small businesses can't afford health insurance and prescription medications. That's unacceptable. It's why I'm focused on lowering health care premiums, increasing access to affordable insurance, and protecting our rural hospitals. We must do everything possible to lower health care costs and ensure that Iowans can receive the care and treatment they need and deserve."

Grassley: Tax credits are handouts to insurers, not families

U.S. Sen. Chuck Grassley, R-Iowa, has been sharply critical of the temporary subsidies and has framed them as an overreach that extended help to households that did not need it.

Grassley said the "COVID Bonuses didn't succeed at lowering the cost of health care — they just sent more taxpayer dollars into the pockets of insurance companies."

"Despite Democrat fearmongering, lower- and middle-income earners will still be eligible for subsidies in 2026 since they're permanent," he said in a statement. "Republicans are committed to finding solutions to bring down health care costs for American families, not extending government handouts to insurance companies. This month, the Senate will spend at least a week debating health care policy, including subsidies, and I look forward to seeing the results of those discussions."

Grassley's office has noted that, since the ACA took effect in 2010, average exchange premiums have risen sharply while provider networks have narrowed, leaving consumers with fewer choices. The senator has said he wants to focus on expanding access and competition through association health plans and other coverage options, reforming pharmacy benefit managers, and improving price transparency to help bring down costs.

Ernst: Temporary subsidies are 'welfare for the wealthy'

U.S. Sen. Joni Ernst, R-Iowa, has tied the subsidy fight to what she describes as broader failures of the ACA for farmers, small business owners and self-employed Iowans.

As Congress clashed over funding and ACA subsidies during the recent shutdown, Ernst argued that Democrats were putting insurance companies ahead of families.

"Democrats shut down the government to protect Obamacare subsidies that send $40 billion to insurance companies," she said in a recent floor speech, characterizing the temporary subsidies as "welfare for the wealthy and corporate welfare rolled all into one."

Ernst has also highlighted her own family's experience with the cost of coverage for relatives with Type 1 diabetes and argued that the ACA's "one-size-fits-none" model ignores "the realities of self-employment, seasonal cash flow and the absence of large corporate employers in farm country."

She called for "accessible ways to provide health care to individuals" and "affordable choices" that do not force spouses into off-farm work just to secure employer-sponsored insurance.

A spokesperson said Ernst and the rest of Iowa's delegation supported providing $50 billion for rural hospitals in the One Big Beautiful Bill "because Americans need a real long-term cure for rising health care costs, not another short-term band aid in the form of a billion-dollar subsidy to insurance companies."

They added: "As conversations remain ongoing, Senator Ernst wants a path forward to ensure accessible health care for all Iowans while also preventing waste, fraud, and abuse from diverting resources from our most vulnerable."

Democrats fault Iowa Republicans for potential hikes

Democrats are placing responsibility for possible premium spikes on Iowa Republicans. Democratic Congressional Campaign Committee spokesperson Katie Smith, in a statement, said Miller-Meeks and Nunn are "directly responsible" for looming insurance hikes, arguing they "prioritized tax cuts for the rich over affordable care for Iowans."

New polling from nonprofit health policy research organization KFF shows 58 percent of ACA enrollees could not afford a $300 monthly increase.

Democrats highlight Miller-Meeks' repeated opposition to extending ACA tax credits and comments suggesting the impact would be limited, despite estimates that thousands in her district would lose coverage and could see premiums nearly double.

They also say Nunn acted too late and previously opposed the enhanced credits. They note he did not sign onto bipartisan letters to congressional leadership or a discharge petition to force a vote, and argue his recent support for a two-year extension is a last-minute political move.

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