NEWS | What the ACA Subsidy Showdown Means for NSBA, Small-Business Owners

As Congress barrels toward another funding deadline, lawmakers are locked in an increasingly urgent fight over the future of Affordable Care Act (ACA) premium subsidy plans, which is an issue with immediate, tangible consequences for many NSBA members and America’s small businesses.

OCT. 08, 2025 | During the pandemic, Congress temporarily expanded ACA premium tax credits, lowering monthly payments and broadening eligibility for millions of Americans, including countless self-employed entrepreneurs and employees of small firms relying on the individual market for coverage.

Without congressional action, those enhanced subsidies will expire at year’s end, causing premiums to snap back to pre-pandemic levels.

Based on rates of expiration, ACA enrollees receiving subsidies will see premiums rise by an average of 114 percent. For small-business owners who purchase coverage on the exchanges, and for the many who help employees offset premium costs, this kind of spike could quickly prove unsustainable.

But the ACA subsidy debate is not just a Washington political fight; rather, it directly impacts the affordability and stability of health coverage for millions of small-business owners and their employees.

For instance, self-employed entrepreneurs, which make up one of the largest segments of ACA enrollees, are facing steep premium hikes at a time when margins are already stretched thin by inflation, interest rates, and labor costs.

Additionally, small businesses without group coverage, which is a fast-growing category of enrollees, are relying more on the ACA marketplace to secure affordable plans for themselves or their teams. Sudden premium spikes make long-term budgeting could render this impossible.

What's more, hiring and retention challenges would intensify if owners cannot offer competitive, affordable coverage options, as greater volatility in the individual market impacts everyone, and higher premiums tend to push more people out of the market, driving costs higher still.

For years, NSBA has stressed that small firms need predictable, stable, and affordable health-care costs. Allowing a sudden 114 percent premium increase, for example, runs directly counter to that principle.

Amidst the ongoing subsidy debate, Senate Republicans are circulating several proposals, including a new framework released by Sen. Mike Crapo (R-Idaho) and Sen. Bill Cassidy (R-La.). Their plan would:

• Provide federally funded health savings accounts (HSAs) for certain high-deductible ACA plans;

• Offer $1,000–$1,500 per person depending on age;

• Extend HSAs to individuals making up to 700% of the federal poverty level;

• Pair these reforms with funding for cost-sharing reductions; and

• Reduce Medicaid funding to states that cover undocumented immigrants.

The senators project these funding cost-sharing reductions would lower premiums by 11 percent starting in 2027, though that relief would come several years after the current premium cliff facing enrollees.

Other Republican proposals include temporary extensions of the current subsidies, some with additional policy conditions and others with a gradual “glidepath” off the enhanced credits.

Meanwhile, Senate Democrats are pushing for a 3-year extension of the existing enhanced subsidies. There is a vote scheduled for Thursday, which is expected to fail unless 13 Republicans join.

With both parties seeking leverage, health-care affordability risks becoming a bargaining chip, leaving small-business owners wedged between fiscal politics and real-world premium bills.

For many small firms, the stakes are clear: a lapse in enhanced subsidies means a direct, immediate cost increase, and uncertainty from Congress complicates business planning at every level.

Long-term solutions must prioritize affordability and predictability for small enterprises.

NSBA continues to urge lawmakers to avoid sudden shocks to the small-business health-care market and pursue bipartisan solutions that address affordability without adding complexity or instability.

Whether through a temporary extension or a structured long-term policy, Congress must ensure entrepreneurs and small firms are not facing overnight premium spikes undermining competitiveness and financial security.

As negotiations continue, NSBA will closely monitor developments and advocate for pragmatic, stable, and affordable health-care solutions for America’s small-business community.