The Trump administration unveiled plans to expand access to catastrophic plans on the Affordable Care Act's (ACA's) exchanges as the expiry of enhanced premium tax credits looms.
The Department of Health and Human Services (HHS) said Thursday that consumers who do not qualify for the advanced subsidies or cost-sharing reductions can apply for a hardship exemption beginning Nov. 1, the first day of open enrollment for the marketplaces.
Individuals can apply online through HealthCare.gov or certified partners, or by submitting a form by mail.
The plans are designed to protect enrollees from unexpectedly high medical costs should they experience a sudden illness or injury. However, while these plans generally have low premiums, they often have steep deductibles for members to meet.
The HHS said in the announcement that these plans will be required to cover three primary care visits before a patient meets the deductible.
“Catastrophic coverage offers affordable health insurance for younger Americans and those facing hardship to have security when they need it most,” HHS Secretary Robert F. Kennedy Jr. said in the press release. “Expanding access to catastrophic coverage is another step in making health insurance more affordable, building on the progress made since the passage of President Trump’s One Big Beautiful Bill.”
The HHS notes that individuals under the age of 30 have always been able to secure catastrophic coverage.
The news comes as enhanced subsidies available for exchange plans are set to run out at the end of this year, and that is a major factor for insurers that are seeking significant premium spikes for 2026. The median rate increase proposed for next year is 18%, according to an analysis from KFF.
Enrollment in plans available on the ACA exchanges has hit record highs over the past several years thanks in large part to those enhanced tax credits, which were put in place in response to the COVID-19 pandemic and later extended through 2025. Experts have warned that ending the subsidies will likely lead to significant coverage losses.
While there was a push from supporters to include an extension in the One Big Beautiful Bill Act, Congress ultimately did not extend the tax credits in that legislation.