With ACA subsidies ending, North Carolinians will face sharp premium increases. Addressing high medical costs, starting with eliminating facility fees, is key to lasting relief.
If you buy health insurance through the Affordable Care Act (ACA) marketplace, get ready: premiums are likely going up next year.
Much of the blame is falling on the expiration of the federal Enhanced Premium Tax Credits — and it’s true these subsidies kept premiums lower for millions of families.
Created during the COVID-19 pandemic, these enhanced credits were designed to make coverage more affordable by paying a portion of people’s premiums. And they worked.
Premiums dropped, and this year, a record 24 million Americans bought health insurance through the ACA marketplace.
But at the end of 2024, the enhanced credits will expire — and the average person could see monthly premiums jump by as much as 75 percent.
However, blaming the end of tax credits misses the real reason costs are climbing.
These credits didn’t fix the underlying problem of expensive healthcare — they only hid it.
The price of health insurance is directly tied to the cost of medical care: doctor visits, hospital stays, prescription drugs, and routine tests.
Insurance companies collect premiums into a pool and use that money to pay medical bills. By federal law, 80–85% of premium dollars must go directly to paying for care. So when hospital or drug costs rise, premiums have no choice but to follow. And costs keep going up year over year.
They are going up so much that even if the federal government were to extend the tax credits, families would still see double-digit premium increases this year.
In North Carolina, we have the highest healthcare costs in the entire country.
For the last few years, the federal government has used tax credits to cushion families and businesses from these costs, even as they kept growing. But now, as that cushion expires, the underlying problem is impossible to ignore.
Real solutions are now needed, not temporary fixes.
One of the simplest and fastest steps North Carolina can take is to eliminate facility fees — hidden charges that hospitals tack onto routine medical visits, even when no hospital facility is used. These fees drive up healthcare costs in our state by more than $200 million every year.
The good news? The North Carolina Senate has already passed legislation to rein in these fees. If the House follows suit, it would represent a true cost-saving reform — not another band-aid that will disappear in a few years.
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