‘The status quo is not sustainable’: ACA subsidy expiration would buckle EDs, limit access for all

The potential expiration of the ACA premium tax credits at the end of 2025 could lead to a significant increase in emergency department visits, exacerbate provider burnout and drive up healthcare costs for everyone — not just those who would lose coverage.

“This isn’t just a policy change that’s going to impact a subset of individuals. It’s going to impact all of us,” Jacquelyn Bombard, assistant vice president and chief federal affairs officer for Providence, told Becker’s. “We all have a stake in this because it’s going to upend  the health system.”

The expiration of ACA subsidies, combined with Medicaid cuts outlined in H.R. 1, could destabilize insurance markets and further strain hospitals across the country, particularly in rural communities already grappling with access and affordability issues.

“It will lead to delays and longer wait times, especially in our emergency departments,” Ms. Bombard said. “And we already have an overburdened health system: physicians and nurses are burnt out, and we have a workforce shortage  in many areas, especially in our remote and rural locations. So, this will impact everyone.”

Providence, a nonprofit Catholic health system headquartered in Renton, Wash., derives about 70% of its patient volume from government programs such as Medicare and Medicaid. In some of the states it serves — such as California, where 40% of the population is eligible for Medicaid — up to 20% of residents could lose health coverage if the subsidies aren’t renewed. 

“With the passage of H.R. 1, we’re very concerned about the Medicaid changes, and what it means for lack of access for these individuals — especially when it comes to preventative care,” Ms. Bombard said. “We’re going to see increased costs and higher volumes in our EDs and a lack of coverage for these individuals. When you add on the instability and uncertainty of these ACA subsidies, it could possibly mean an additional 20% for example, in some of our states, could lose access to health insurance.”

In total, as much as 40% of the population in affected states could lose insurance access when considering both Medicaid eligibility changes and the potential ACA subsidy lapse, according to Ms. Bombard. This could cause ripple effects across the healthcare system: risk pools in the ACA marketplace would shift, leading to higher premiums for those who retain coverage, and hospitals may need to scale back services to stay financially viable.

Providence is advocating  for an extension of the premium tax credits. The 51-hospital system’s leaders are engaging in direct lobbying, meeting with members of Congress and partnering  in national coalitions such as Keep Americans Covered to stress the on-the-ground consequences in local communities.

However, Ms. Bombard said the lack of clarity around federal healthcare policy has made financial and operational planning extremely difficult. 

“It is hard to financially plan. It’s hard to better understand what our payer mix might look like in all of our hospitals. It’s also hard to plan on what policies are going to be extended and what will not be extended at the end of the year,” she said. “It causes a lot of uncertainty for us, but we’re trying to do the best we can to prepare for whatever is ahead of us and what it means for our patients.”

Providence has been transparent with its board, physicians and community leaders about the financial headwinds it’s facing, which include declining revenues, rising labor costs and the prospect of additional state-level pay cuts. 

Ms. Bombard said health systems must play a leading role in shaping the policy narrative before time runs out.

“The status quo is not sustainable,” she said. “If we don’t extend these subsidies, it’s going to dismantle our health system — and every patient, every provider and every community is going to feel that.”

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