ACA Subsidy Rollback: A Broader Credit Story for Public Finance

KBRA expects an increase in uncompensated care across the health care ecosystem following the expiration of enhanced premium tax credits at the end of 2025, although the magnitude of the impact remains uncertain. This trend has negative credit implications for hospitals and creates knock-on pressures for states already facing budgetary constraints stemming from the One Big Beautiful Bill Act (OBBBA).

While there are proposals in Congress to address the expiration of the enhanced premium tax credits, none represent a long-term solution, and enactment remains uncertain. In KBRA’s view, the risk of rising uncompensated care and mounting financial pressures at the state and local levels will remain ongoing credit concerns.

Key Takeaways