ACA Subsidies 2027: What Changed After the Enhanced Credits Expired (and the 400% Cliff)

October 2, 2026 · Guides

Updated October 2026 for the 2027 plan year. Reflects the expiration of the enhanced premium tax credits on December 31, 2025 and the IRS’s 2027 contribution percentages.

What happened to the enhanced ACA subsidies?

The enhanced ACA subsidies expired on December 31, 2025, and Congress did not extend them. For plan years 2021 through 2025, those enhancements capped what anyone paid for a benchmark plan at no more than 8.5% of income and removed the income ceiling on eligibility. The ACA’s original, smaller subsidy formula took over for 2026 and remains in force for 2027.

The short version of ACA subsidies 2027: smaller credits, a hard cliff at 400% FPL and higher premiums. This is a change in federal law, not a change by any insurer or by HealthCare.gov. Marketplace plans and protections are unchanged: insurers still cannot deny you or charge more for a pre-existing condition. What changed is the math behind your premium tax credit. For millions of people that math produced a larger monthly bill starting in 2026, with another round of rate increases proposed for 2027. You can read the official rules on premium tax credits at IRS.gov.

ACA subsidies 2027 timeline: how we got here

The enhanced credits were always temporary. They were created as pandemic relief, extended once, and then allowed to lapse after extension bills failed in late 2025 and early 2026.

As of mid-October 2026, no law restoring the enhanced credits for 2027 has been enacted. If Congress acts later, HealthCare.gov and the IRS would announce new rules; until then, plan around the original formula.

Is the 400% subsidy cliff back for 2027?

Yes. The 400% FPL subsidy cliff applies to 2027 coverage. Two specific rules reverted when the enhanced credits expired, and together they drove most of the premium increases in 2026.

The 8.5% income cap disappeared

Under the enhanced rules, your benchmark Silver premium was capped at 8.5% of household income no matter how much you earned. That cap is gone. The original ACA formula asks higher earners to pay a steeper share of income before any credit applies. For 2027, the IRS sets that expected contribution between 2.15% and 10.22% of income (Rev. Proc. 2026-26), up from 2.10%–9.96% in 2026. The subsidy shrinks and your share grows.

The 400% FPL subsidy cliff returned

The “subsidy cliff” means that once your income passes 400% of the federal poverty level, you lose premium tax credits entirely, not gradually but all at once. A household just one dollar over the line can go from a meaningful subsidy to zero. For 2027 coverage that threshold is $63,840 for an individual and $132,000 for a family of four (based on the 2026 poverty guidelines).

ACA subsidies 2027 vs 2025: enhanced vs original rules

The clearest way to see what changed is side by side. The left column is the last year of the enhanced credits; the right column is the rule set for 2027 coverage.

For the full 2027 percentage table and an income-band calculator, see our evergreen guide to how health insurance subsidies work in 2027.

ACA subsidies in 2027: how much more will you pay?

Before the credits expired, KFF estimated that subsidized enrollees’ annual premium payments would more than double on average, a jump of about 114%. For 2027, KFF‘s review of insurer filings shows a median proposed rate increase of about 15%, the second straight year of double-digit hikes after a median finalized increase of about 20% for 2026.

Your net cost for 2027 depends on how much credit the formula leaves you. The table below shows the shape of the change. Actual figures vary by age, income, ZIP code and the plans sold in your area, so treat it as an illustration of direction, not a quote.

The pattern is clear: the closer you are to the cliff, or just past it, the bigger your increase. Lower-income households keep more of their help but still see premiums rise as the formula tightens and base rates climb again for 2027.

ACA subsidies 2027: who gets hit hardest?

The 2027 subsidy rules do not land evenly. Four groups feel it most.

• People over 400% FPL. This group gets no subsidy at all because of the cliff. A 60-year-old couple with modest retirement income can cross that line easily and face the full benchmark premium.
• Older enrollees. The ACA lets insurers charge older adults up to three times more than younger ones. Because their starting premiums are higher, losing or shrinking a subsidy hurts them more in raw dollars.
• Middle-income households near the cliff. Those who were capped at 8.5% of income now pay the steeper original percentage, up to 10.22% for 2027.
• Many lawfully present immigrants. From January 1, 2027, the premium tax credit is limited to citizens and nationals, green card holders, Cuban and Haitian entrants, and COFA migrants. Other lawfully present immigrants can still enroll but lose financial help. See who still qualifies for subsidies in 2027 and HealthCare.gov’s immigrant guidance.

Younger, lower-income enrollees are more insulated because they keep the largest share of their credit. Still, no one on a subsidized Marketplace plan should assume their 2027 renewal costs the same as 2026. If your bill already jumped, our guide to why your health insurance premium went up walks through the other causes.

ACA subsidies 2027: what else changed?

Beyond the expired enhancements, three other rule changes affect ACA subsidies for 2027. They come mainly from the 2025 federal budget law (Public Law 119-21, also called H.R. 1).

• No repayment cap. Beginning with tax year 2026, the IRS says you must repay the full amount of any excess advance premium tax credit when you file IRS Form 8962. Underestimating your 2027 income is now riskier.
• Narrower immigrant eligibility. Starting January 1, 2027, only citizens and nationals, green card holders, Cuban and Haitian entrants, and COFA migrants can get the credit.
• Higher cost-sharing limits. The 2027 out-of-pocket maximum rises to $12,000 for an individual and $24,000 for a family (HealthCare.gov), up from $10,600 and $21,200 in 2026.

One thing did not change: Open Enrollment for 2027 coverage still runs November 1, 2026 to January 15, 2027 in HealthCare.gov states, with December 15, 2026 the deadline for a January 1 start.

ACA subsidies 2027: do they still exist?

Yes. ACA subsidies did not disappear. The enhanced version expired, but the original premium tax credit that has existed since 2014 remains in place. In 2026, CMS reports that 87% of Marketplace consumers still selected plans with an advance premium tax credit.

If your income falls between 100% and 400% of the federal poverty level, you can still qualify for help with 2027 coverage on the older, smaller sliding scale. Two forms of help are still available:

• Premium tax credits that lower your monthly premium, based on income and the benchmark Silver plan in your area.
• Cost-sharing reductions (CSR) that cut your deductible and out-of-pocket costs, but only if you enroll in a Silver plan and your income is at or below 250% FPL.

Because CSR is tied to Silver, and the 2027 out-of-pocket maximum rises to $12,000 for an individual, the metal tier that was cheapest for you in 2026 may not be the smartest choice for 2027. Our guide to 2027 subsidies and the premium tax credit walks through the full formula, and you can confirm current rules directly at HealthCare.gov.

Your ACA subsidies 2027 action plan before you renew

With smaller subsidies and higher proposed rates, doing nothing is the most expensive choice for 2027. Auto-renewal keeps your old plan at new 2027 pricing and will not move you to a cheaper option even if one now exists. Follow these steps instead.

1. Recheck your income and MAGI. Your subsidy hinges on your modified adjusted gross income. Re-estimate 2027 income carefully, and if you are near 400% FPL, look at legal ways to lower MAGI, such as HSA or retirement contributions, that could restore a credit.
2. Compare every plan before renewing. Premiums, networks and subsidy amounts change every year. Run a fresh comparison across carriers and tiers rather than accepting the auto-renewal.
3. Consider Silver and CSR. If your income is at or below 250% FPL, a Silver plan can unlock cost-sharing reductions that make it a better overall value than a cheaper-looking Bronze plan.
4. Check Medicaid eligibility. If your income dropped, you may now qualify for Medicaid, which could cost far less than any Marketplace plan.

Timing matters too: Open Enrollment for 2027 runs November 1, 2026 through January 15, 2027 in HealthCare.gov states, and the deadline for January 1, 2027 coverage is December 15, 2026. See how the full Health Insurance Marketplace works before you choose.

Medicaid and other affordable options

If 2027 premiums strain your budget, you have paths beyond a standard Marketplace plan. Medicaid covers adults up to about 138% FPL in the 40 states plus DC that expanded it, at little or no cost. Adults under 30, or anyone with a hardship exemption, can consider a Catastrophic plan with a low premium and high deductible for worst-case protection. Choosing the right metal tier (Bronze covers about 60% of costs, Silver 70%, Gold 80%, Platinum 90%) lets you balance premium against expected care.

The right move depends on your income, your health and the plans sold where you live. Explore more affordable health insurance options to see what fits.

ACA subsidies 2027 FAQ

The 400% cliff is measured against the 2026 HHS guidelines; see the full 2026 FPL chart and Obamacare income limits for your household size.

The repayment caps are also gone starting with tax year 2026; our Form 1095-A guide explains how full repayment works on Form 8962.

New to the law itself? Start with Obamacare explained.

Keep learning: 2027 subsidies explained · How the Health Insurance Marketplace works · Affordable health insurance options · Open Enrollment 2027 dates & deadlines

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