The State of the Affordable Care Act Under the Second Trump Administration
The Affordable Care Act (ACA) is a cornerstone of healthcare policy in the United States. Over the years it has undergone significant changes, from expanding Medicaid in many states to increased subsidies to reduce premium costs. As the healthcare landscape evolves under the second Trump administration, new policies, challenges, and potential repeals will continue to shape the ACA.
The Importance of the ACA
The Affordable Care Act was a landmark reform of the U.S. healthcare system. Championed by President Obama, it aimed to increase access to affordable health insurance, improve care quality, and reduce healthcare costs. One of its key achievements is expanding access to health insurance. The ACA has broadened Medicaid eligibility in participating states and established health insurance marketplaces, offering subsidies to make coverage more affordable for low- and middle-income individuals. Those subsidies led to a record-breaking 24 million people enrolling in the ACA for 2025(2) The ACA also prohibits insurance companies from denying coverage or charging higher premiums based on pre-existing conditions and allows young adults to stay on their parents' insurance plans until age 26. To improve affordability, the law provides financial assistance through subsidies and tax credits to help families manage premiums and out-of-pocket expenses. Medicaid expansion under the ACA has also extended coverage to millions of low-income Americans in states that have adopted it.
The ACA has introduced critical consumer protections, including eliminating lifetime and annual caps on essential health benefits and requiring all ACA-compliant plans to cover essential services such as preventive care, maternity care, and mental health services. It has ensured many preventive services, such as vaccines and screenings, are covered without cost-sharing, making healthcare more accessible and proactive. Additionally, the ACA emphasizes public health by promoting preventive measures and addressing broader health needs. All these policy changes have caused ACA protections to be popular among the majority of Americans(3).
President Trump’s View on the ACA
Former President Donald Trump has criticized the Affordable Care Act, describing it as "costly" and offering "lousy" coverage. During his 2016 campaign and subsequent presidency he advocated for repealing and replacing the ACA, though legislative efforts to dismantle the law were unsuccessful. In his 2024 presidential campaign, Trump has reiterated his intent to modify or replace the ACA, stating he has "concepts of a plan" that would be better. However, neither Trump nor other high-ranking members of the GOP have released a comprehensive healthcare plan detailing how they intend to alter or replace the ACA.
Potential Avenues for Trump’s ACA Changes:
1. Let the Biden-Era subsidies expire
Trump and the newly Republican-controlled House and Senate could weaken the ACA by allowing enhanced subsidies, which currently help lower premiums and reduce the uninsured rate, to expire in late 2025. Without congressional intervention, premium costs could significantly rise for many consumers, leading to a potential increase of 1.7 million uninsured individuals annually over the next decade3. This would disproportionately affect Republican-led states like Texas and Florida, posing a political dilemma. Due to the narrow margin in which the House and Senate are controlled, just a few dissenting votes from Republican congresspeople could sink a potential new enhanced subsidies bill.
Additionally, a Trump administration could stop defending key ACA provisions in court, such as the mandate requiring insurers to provide certain preventive services at no cost. If legal challenges succeed, it could undermine protections that currently cover millions of Americans and pave the way for similar lawsuits, thus jeopardizing broader yet important aspects of the ACA.
2. Changing the ACA Funding
Congress could alter the ACA using the budget reconciliation process, which bypasses the need for Democratic support. However, similar to the enhanced subsidies, the narrow Republican majorities in both the House and Senate mean even a few dissenting votes could derail such efforts. Significant changes would require congressional approval, such as modifying Medicaid's funding formula. Conservatives have suggested reducing federal funding for Medicaid expansion, which primarily supports higher-income adults and those without children, rather than traditional beneficiaries like pregnant women, children, and individuals with disabilities.
Another proposal would allow ACA subsidies to be used for non-compliant health plans. While this could make cheaper, less comprehensive coverage available for healthier individuals, it might lead to higher premiums for older or sicker individuals who rely on more robust plans. Some experts see this as a repackaged version of earlier ACA repeal efforts. Additionally, Congress would need to approve any plans to redirect a portion of ACA subsidies into health savings accounts for eligible medical expenses.
3. Presidential Executive Orders
President Donald Trump may take executive actions to alter healthcare policies, such as his past approach of encouraging states to seek waivers that adjust how Medicaid is funded and administered. These waivers, which offer states more control, have seen bipartisan support. Experts suggest Trump could pursue actions that bypass congressional approval to achieve his objectives.
During his previous presidency, Donald Trump frequently used executive orders to modify the ACA. In 2017, he issued an order increasing access to short-term health plans that didn't comply with ACA regulations(3). While the Biden administration restricted these plans, calling them inadequate due to limited coverage and exclusions for preexisting conditions, a Trump administration could reverse those changes, allowing them to remain available for extended periods.
Trump could issue similar orders to initiate changes, such as stricter oversight of fraud or reductions in federal funding for ACA outreach and enrollment assistance, which previously led to decreased participation in the program(4).
Trump's Affordable Care Act Plans Could Shrink Some Healthcare Coverage - Business Insider
Affordable Care Act 2025 enrollment hits record at nearly 24 million
How Trump and Republicans may change the Affordable Care Act and Medicaid : Shots - Health News: NPR
What Trump’s 2024 Victory Means for the Affordable Care Act | KFF