The Politics of Healthcare Are Getting Messy

Concerns about healthcare costs could speed up political demand for some version of a single-payer system

The U.S. House of Representatives is in shambles. A slim majority has made it difficult for Republican leadership to do much since the passage of the so-called “One Big Beautiful Bill Act” (OBBBA) in early July. Since then, the wheels have slowly come off, leaving a one-wheeled chassis barely scraping along on a very bumpy road to November 2026.

At the moment, healthcare is the issue that’s the source of consternation in the House—specifically, the expiration of the enhanced premium tax credits. Stop me if you’ve heard this one before. The 2018 midterms were, in part, a referendum on Republicans’ effort to “repeal and replace” the Affordable Care Act (ACA). That effort featured prominently in effective Democratic attack ads against vulnerable Republicans. Healthcare is already a problem for Republicans because of the changes to the Medicaid program made by OBBBA.

Healthcare has consistently ranked among the top three to five issues in The Economist and YouGov's weekly tracking survey. Actually, this week’s survey showed healthcare ranked second most important, behind only inflation/prices. According to the survey, 23 percent of registered voters ranked inflation/prices as the top issue, 13 percent said healthcare, and 11 percent said jobs and the economy. None of these issues plays to Republicans’ strengths right now. Immigration does come in as the fourth-most important issue, at 10 percent, but that’s largely because of Republicans.

So, what’s the current issue with healthcare? As you likely recall, the ACA created premium tax credits to help people purchase health insurance coverage on the individual market. As enacted, the premium tax credits were available only to people earning between 100 percent and 400 percent of the federal poverty level who purchased coverage on the exchanges.¹ The subsidy amount was tied to income and designed to cap what households paid for a benchmark plan, with eligibility ending entirely once income exceeded the upper threshold.

Created by the American Rescue Plan Act of 2021, the enhanced ACA tax credits expanded the original subsidies by lowering the share of income households must pay toward premiums and increasing the federal contribution at every eligible income level. The 400 percent income cutoff was eliminated, allowing families to receive assistance and capping premiums at a fixed percentage of household income. Although the enhanced tax credits were scheduled to expire at the end of 2022, Congress extended them through 2025 in the Inflation Reduction Act of 2022.

The looming expiration of the enhanced premium tax credits was one reason Democrats were unwilling to reopen the government. Democrats want to extend these tax credits as part of negotiations to end the government shutdown. A handful of Senate Democrats were able to leverage their votes for a guarantee from Senate Majority Leader John Thune (R-SD) to vote to extend the enhanced premium tax credits before the end of the year. No outcome was promised. Only a vote. That effort failed last week when the Senate rejected the Democratic proposal by a vote of 51 to 48.²

To be clear, it’s not only Democrats who support extending the enhanced premium tax credits. Some Republicans—including Reps. Brian Fitzpatrick (R-PA), Jen Kiggans (R-VA), and Mike Lawler (R-NY)—also support extending them. Sens. Susan Collins (R-ME) and Lisa Murkowski (R-AK) are among the Senate Republicans who support extending the tax credits. A permanent extension of the tax credits would add $349.8 billion to the deficit over ten years.³ However, a three-year extension would add about $85.7 billion.⁴

The House is set to consider a healthcare bill, the Lower Health Care Premiums for All Americans Act, H.R. 6703. Presumably, House Republican leadership hopes that consideration of this bill will get some of the pressure off their backs and some members’ backs. The Lower Health Care Premiums for All Americans Act has market-based changes to health insurance policy, including expanding association health plans (AHPs) and increasing transparency for pharmacy benefit managers (PBMs). These are generally good ideas, and Republicans have data from the Congressional Budget Office showing that their bill would reduce premiums by an average of 11 percent.⁵

The Lower Health Care Premiums for All Americans Act does not, however, include an extension of the enhanced premium tax credits. Not only does the bill not include the extension of those enhanced tax credits, amendments led by Fitzpatrick and Kiggans to extend them by one and two years, respectively, weren’t made in order by the House Rules Committee.⁶ Spurned by Rules, Fitzpatrick and Lawler, along with Reps. Rob Bresnahan (R-PA) and Ryan Mackenzie (R-PA), signed a discharge petition to force a vote in the House to extend the enhanced premium tax credits for three years.⁷

Other than providing you with the background, I’m compelled to offer a lay of the land on healthcare. Ordinarily, I would say that extending the enhanced premium tax credits is a bad idea. That comes from my concerns about the budget deficit. Generally, I’m of the mind that if there’s not an offset of the cost of a bill, Congress shouldn’t pass it. However, there are politics that come into play with this issue that deserve deeper consideration.

First, health insurance premiums are expected to rise by a median of 18 percent on the individual market in 2026. Increases are also happening in the group market. As Mercer explains, “The total health benefit cost per employee is expected to rise 6.5% on average in 2026 — the highest increase since 2010 — even after accounting for planned cost-reduction measures. Employers estimated that plan cost would increase by nearly 9%, on average, if they took no action to lower cost.”

Second, Americans want the expanded premium tax credits to continue. If you’re a Republican who opposes extending the subsidies, the best numbers I’ve seen are that only 51 percent of registered voters support extending the subsidies while 33 percent oppose.⁸ Among independents, 48 percent support extending the subsidies and 26 percent oppose. A Republican-backed poll found that 60 percent of registered voters support extending the subsidies. However, this poll showed some wiggle room for Republicans. The poll found a drop in support once registered voters were informed of Republican alternatives.⁹ The Kaiser Family Foundation showed in October that 78 percent of adults want the enhanced premium tax credits extended. Another poll, this one from Marquette in November, found that number at 70 percent.

Although Republicans have taken aim at the Affordable Care Act in recent days, polling also shows that 57 percent of Americans approve of the 2010 law.¹⁰ Only 35 percent disapprove of it. Rehashing that argument, considering how badly Republicans traditionally do on healthcare with voters, probably isn’t a winning argument.¹¹

This brings me to my third and final point. We are inching closer to some version of “Medicare for all.” Perhaps not what Sen. Bernie Sanders (I-VT) envisions with his bill, S. 1506, but we’re getting closer to it. One can reasonably argue that we’re already halfway there. In 2023, for example, 46.3 percent of national health expenditures were paid for by government—Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), Department of Defense, Department of Veterans Affairs, and Public Health Activity.¹² That’s actually down from 47.3 percent in 2022. Private insurance was 30.1 percent of national health expenditures in 2023. Only 10.4 percent were out-of-pocket costs.¹³ The remainder is investment (4.9 percent) and other third-party payers (8.3 percent), including public and private health spending.

The shoe could eventually drop if employers begin to see health insurance coverage for their employees as a burden. Some would argue that employers already feel this way because of the costs and time required to provide employee insurance coverage. Employers can deduct direct costs, and health insurance benefits remain attractive when recruiting prospective employees. That’s becoming more difficult due to premium increases and shrinking provider networks.

The real inflection point is not ideological; it’s economic. If employer-sponsored coverage continues to grow more expensive, more administratively complex, and less effective at expanding access—while the individual and public markets become more stable and subsidized—the logic underpinning the employer-based system begins to erode. At that point, some form of “Medicare for all” doesn’t arrive through a single sweeping vote in Congress; it arrives through attrition. The United States wouldn’t so much choose a public option or a single-payer system as drift into one, as employers quietly step back, public financing quietly steps forward, and the line between public and private health coverage continues to blur.

I want to be clear here. I’m not a fan of single payer. I also don’t for a second believe that we should go back to the health insurance system that existed before the ACA. It’s also amusing to me that progressives ignore that countries with single-payer still have private health insurance markets. Roughly three-quarters of countries with single-payer health care still maintain robust private markets that supplement public coverage by offering faster access, broader provider choice, or benefits the public system excludes. In practice, single-payer centralizes financing, not demand for private alternatives, which tend to persist where governments set limits on costs or access.

Although I’m not making predictions, I wouldn’t at all be surprised to see support emanate from the populist wing of the conservative movement—the so-called “national conservatives—for a single payer healthcare system in the United States within the next few years. I almost expect it, at this point.

1. Eligibility begins at 138 percent of the federal poverty level in states that expanded Medicaid.

2. The Republican alternative was also rejected.

3. The figure comes from the first part of the table, under “Permanently Extend the Expanded Premium Tax Credit.”

4. This is the sum of the net effect on the deficit from FY 2026 through FY 2028.

5. Granted, some 100,000 fewer people would have health insurance.

6. See “Committee Votes.” It’s the first roll call listed.

7. The petition would discharge H.Res. 780, which would provide for the consideration of H.R. 1834. H.R. 1834 would eventually be substituted with the text to extend the expanded premium tax credits.

8. These data are over a month old. The survey was conducted from November 15 to November 17.

9. I tend not to take polls like this seriously past the initial number because getting the number down requires explanation and nuance that doesn’t fit neatly into our politics these days. That’s not to say they’re not valid. It just requires Republicans to be trusted on healthcare, and they’re simply not.

10. This includes 63 percent of independents.

11. Objectively, the ACA increased health insurance premiums before premium tax credits are taken into account. It’s impossible to increase actuarial mandates, impose guaranteed issue and community rating, eliminate medical underwriting, and allow only limited premium variation based on age, geography, and tobacco use without increasing premiums. “Guaranteed issue” is the technical term for coverage for people with preexisting conditions. Personally, although I know it increases premiums, I’m supportive of that mandate. It’s also politically impossible to nix it. I had to wrestle with that when I was at FreedomWorks because there was a big push behind the scenes to get rid of it. Granted, that never went anywhere because the Democratic attacks were so strong.

12. I already had the 2023 data saved, which is why I’m using it.

13. Typically, what I argue is that the shift to third-party payers—including private insurance, Medicare, Medicaid, and so on—and away from out-of-pocket costs is one big reason healthcare costs have skyrocketed. It’s one reason I’m such a big fan of health savings accounts. Sadly, I’m afraid that battle is nearly lost.