WASHINGTON (Oct. 16, 2025) — A report from researchers at the George Washington University and the Commonwealth Fund warns of serious implications if the Affordable Care Act (ACA) tax credits expire at the end of this year.
The analysis, Expiring ACA Premium Tax Credits Could Lead to Nearly 340,000 Jobs Lost Across the U.S. in 2026, finds that if the enhanced tax credits are not renewed, state economies would shrink by $40.7 billion in 2026, roughly 339,000 jobs would be lost, and state and local tax revenues would be reduced by $2.5 billion.
The report cites earlier Urban Institute analysis estimating that nearly 5 million people would become uninsured beginning in January 2026, and millions more would see their premiums rise.
Extending the tax credits would help keep health insurance costs affordable. However, the move to extend the ACA premium tax credits has become a point of contention in the debate on Capitol Hill.
The analysis, led by Leighton Ku and colleagues at GW, used new data to update earlier research that explored the economic impacts of letting the ACA marketplace tax credits expire.
Key Research Findings:
- Federal funding for marketplace tax credits will decline by $31 billion.
- The reductions in funding for healthcare and related downstream impact, will cause state economies to shrink by nearly $41 billion.
- Because of these economic losses, nearly 340,000 jobs will be lost in 2026; slightly less than half will be in the healthcare sector.
- State and local revenues will decline by $2.5 billion.
States hit hardest by the job losses are predominantly in the South. Texas leads the pack, followed by Florida, Georgia, California, South Carolina, Tennessee, Alabama, Louisiana, North Carolina and Mississippi.
“There is an urgent need to decide whether to extend the ACA tax credits soon; insurance enrollment begins on November 1. Not only will health insurance costs soar for millions if the tax credits are not sustained, there will be severe economic consequences and more than 300,000 Americans could lose their jobs,” said Leighton Ku, professor of health policy and lead author of the report.
The analysis, Expiring ACA Premium Tax Credits Could Lead to Nearly 340,000 Jobs Lost Across the U.S. in 2026, was funded by The Commonwealth Fund.
-GW-