The GOP’s Health Care Math: Pay More, Get Less

The Center for Medicare & Medicaid Services announced out-of-pocket maximums will increase to over $21,000 for families.

The dawn of a second Trump presidency has brought a series of often confusing and overlapping proposed changes in health care coverage for everyday Americans – a dizzying array of administrative actions and proposals in Congress that seem to have one big thing in common.

Simply put, they don’t make it easier for Americans to get health insurance, to pay for either their premiums or out-of-pocket doctor bills, or avoid the threat of medical bankruptcy.

A little-noticed example came in March when the Centers for Medicare and Medicaid Services (CMS) changed a payment formula that increased the yearly maximum in out-of-pocket expenses for people enrolled in the highest-deductible plans, both through the Affordable Care Act’s Marketplace and employer-based coverage.

Existing law allows the government to look every year at rising inflation in the health care industry, and related factors, to adjust the out-of-pocket maximum in these plans, which insurers convinced the Democrats who enacted the ACA in 2010 was necessary to hold down medical costs. These upper limits, which leave many patients to pay the bulk of their medical bills until there’s a catastrophic illness or accident, have skyrocketed since the arrival of so-called Obamacare in the early 2010s.

A CMS rule for calculating the yearly increase, which was imposed by the first Trump administration for a couple of years, then dropped under President Joe Biden, has been again proposed by the new Trump team. The rule could have devastating consequences for millions of mostly lower-income Americans who often purchase so-called bronze plans through the Health Insurance Marketplace, with lower premiums but higher out-of-pocket costs.

These upper limits have already soared from 2014, the first year of the ACA’s implementation, when the out-of-pocket maximum for individuals was $6,350 and $12,700 for family coverage. In 2026, even the old methodology had initially called for a steep 15% increase. 

Neither Democrats nor Republicans have taken meaningful steps to reduce these out-of-pocket maximums, which amount to roughly one-third of median household income. Worse, the new math proposed by the Trump CMS adds yet another 4% hike on top of that, which means individuals in some plans will pay $10,600 before their insurance kicks in, with a bump to $21,200 for families. From the launch of Obamacare, that’s an overall increase of 83% for individuals and 67% for families.

Middle-class Americans are not just being nickel-and-dimed but dollared to death by these callous decisions that force people to choose between going to a doctor or the basics like buying groceries or paying their utility bill.

This is actually part of a double whammy, since the same fuzzy math around inflation is used to recalculate the allowable yearly increases in premiums. In its report on CMS’ proposed ceilings for 2026, the Commonwealth Fund noted that a family earning $85,000 could pay $313 more in premiums annually under the policy change and $900 more in out-of-pocket costs, if it reached the out-of-pocket maximum

It’s part of an overall health care strategy that would provoke a critic to say that the cruelty is the point, because every announced policy change or tweak in the rules would reduce the number of Americans benefiting from health insurance, by making it not just more expensive but harder to sign up.

Earlier this month, the House Energy and Commerce Committee advanced a bill that, in addition to widely reported cuts in Medicaid, would codify a series of sweeping changes to the ACA Marketplace plans that were first proposed by CMS back in March.

Louise Norris, a health-insurance policy expert with the site Verywell, noted that there had been a mini-scandal around fraudulent sign-ups by brokers for Marketplace insurance plans in the wake of the 2020-21 pandemic. But she said there are simpler ways to curb this type of abuse than the measures proposed by CMS or in Congress.

“The state-run marketplaces for the most part didn't have issues with enrollment fraud [because] in most cases state-run marketplaces had things like two-factor authentication in place so brokers couldn't just go in,” Norris said. But she added the type of changes proposed by the Trump administration would block eligible patients from the program. “Any time you add extra documentation requirements, you will also catch some people in your net who maybe just either don't know how [to apply] or aren't willing to jump through the hoops.”

Zachary Baron, a director of the Center for Health Policy and the Law at the O’Neill Institute, agreed that the GOP claims of attacking abuse in government health care programs don’t address the reality that honest middle-class families will be hurt by the changes.

“They want to sort of crack down on fraud, waste and abuse but then they basically do nothing in terms of proper practices by brokers and agents,” Baron said. “Instead, their message is, let's make it harder on more low- and middle-income folks.”

The Marketplace changes would, starting this fall, create a Nov. 1 to Dec. 15 open enrollment schedule that would run nationwide, thus overriding longer windows in some state plans. The bill would also eliminate the year-round special enrollment period for applicants who are eligible for subsidies with household income up to 150% of the current poverty level.

In addition, the proposed legislation would prevent enrollees from automatically renewing $0 premium plans, instead imposing $5 monthly fees until the user logged on and actively confirmed their membership. This seemingly trivial change could have a large impact, since during the last enrollment period more than half of the Marketplace renewals were auto-renewals.      

Indeed, every tweak to Marketplace enrollment moves in the same direction: making it harder for Americans – but especially the underprivileged or those with lower incomes – to sign up for government-assisted health insurance.       

To get some sense of this, consider the legislation that recently passed the House: It would repeal the auto-renewal protocol that allows the Marketplace to move someone from a bronze to silver plan during auto-renewal, if available with the same network and no increase in premium. It prohibits coverage of gender-affirming care as an essential health benefit on Marketplace plans and eliminates Marketplace access for immigrant “dreamer” children protected by the government’s DACA (Deferred Action for Childhood Arrivals) program. Even if the legislation falters on a gridlocked Capitol Hill, CMS could impose such measures by administrative fiat.   

If these changes are enacted, more Americans will end up without health insurance, a throwback to the days before the ACA was passed. According to calculations by Norris, these changes alone are likely to reduce the number covered by the ACA Marketplace plans by at least 750,000 and perhaps by as many as 2 million.        

And that’s still ignoring the elephant in the room: Republicans seem determined to end the enhanced subsidies – delivered in the form of premium tax credits – that were enacted during the depths of the COVID-19 pandemic and helped millions of Americans keep or obtain health coverage through the crisis. Those credits are slated to expire at the end of this year, and Republican lawmakers have made it clear in current iterations of their budget bill that there’s no intention to renew them.     

An analysis by the Urban Institute found that about 7.2 million Americans would lose subsidies, and about 4 million of those would likely end up uninsured. The institute noted that these reductions would most severely impact the red states that voted for Trump, and wrote that “local policymakers must consider the expiration’s potential to cause another crisis in health care access and affordability.”

Given how unlikely it is that access to care will expand during Trump’s four years in the White House, a number of states – many of them with Democratic statehouses – are looking to do exactly that. Norris pointed to efforts in states such as Illinois, which is expanding access and ease of purchasing ACA Marketplace plans, while other states are looking at ways to enhance subsidies in their own budgets to compensate for the expected federal reductions in 2026.

It’s also possible that the outcry over the planned reductions in health insurance aid and access could force Republicans to backtrack on some of the more extreme measures, or at least defer them. Baron noted that highly negative public comments to some of the Marketplace changes after they were proposed by CMS in March came not just from consumers but from hospitals and even insurers who fretted the cutbacks would go too far, too fast.