What Happened After the Shutdown & How the New Reforms Help Patients

outreach0686
Nov 29
5 min read

Why ACA (Obamacare) Plans Became Expensive and How Trump’s HSA Plan Puts Money Back Into Patients’ Hands

1. What ACA Plans Were Supposed to Do — and What Really Happened

The Affordable Care Act (ACA) was designed to help families buy affordable insurance by offering Bronze, Silver, and Gold plans with different levels of premiums and deductibles.

Most people in the United States qualify for these marketplace plans as long as they live in the U.S., are U.S. citizens or legal residents, and are not eligible for Medicare. Many individuals also qualify for financial help to lower their monthly premiums, and lower-income families who choose a Silver plan may receive Cost-Sharing Reductions (CSR), which were supposed to lower deductibles and copays. In some states, very low-income individuals may qualify for Medicaid instead of marketplace subsidies.

However, the reality for many families has been very different. Premiums continued to rise, deductibles became unaffordable, and networks shrank to the point where it was often difficult to find care.

It became common for patients to say, “I finally have insurance, but I still can’t get care.” At the same time, the ACA’s structure allowed insurance companies to raise prices, collect larger subsidies, and profit even as patients struggled. CSR dollars were also sent directly to insurance companies rather than to patients, ultimately making insurers richer without meaningfully improving affordability or access.

To understand how this happened, it helps to look at how ACA plans actually work. The ACA organizes plans into Bronze, Silver, and Gold “metal tiers,” which describe how costs are shared, not the quality of care.

Bronze plans have the lowest monthly premiums but the highest deductibles, meaning patients pay most costs out of pocket until meeting the deductible.

Silver plans have moderate premiums and deductibles and are the only plans eligible for CSR assistance.

Gold plans have higher premiums but much lower deductibles and out-of-pocket costs, making them more practical for people who use more healthcare.

While this structure was meant to offer flexibility, it often left families stuck with high costs, narrow networks, and limited real access to care.

2. Why ACA Plans Ended Up Helping Insurers More Than Patients

Insurers quickly learned that if they raised the price of Silver plans, the plans used to calculate government subsidies, the government would simply pay more. This meant insurers could increase premiums while taxpayers covered the difference, with no improvement in care.

Cost Sharing Reduction (CSR) subsidies, meant to help lower deductibles and copays for low income families, also went straight to insurance companies rather than patients. Most ACA plans still carried deductibles of $5,000–$9,000, leaving families paying premiums each month and then paying out of pocket for most of their care.

To further cut costs, insurers shrank their provider networks. Patients faced long waits, limited access to specialists, and surprise bills, while insurers saved money. During COVID, when subsidies were expanded, insurers raised premiums even higher knowing the government would cover most of the increase.

By 2024, large numbers of people enrolled in ACA plans never used any care at all, and millions were “phantom enrollees” listed in the system for subsidy payments but never filing claims. Insurers still got paid full premiums for them. Here is the link to the study at from Jeremy Nighohossian at the Competitive Enterprise Institute for more details.

What is more, Paragon Health Institute estimates that more than 6.4 million individuals were fraudulently enrolled in exchange plans during 2025.

3. What Happened After the Shutdown

When Congress reopened the government, they did not grant the extra ACA subsidy dollars insurers were demanding. Instead, lawmakers allowed the temporary COVID-era subsidies to expire because they were costly, prone to fraud, and inflationary. Insurance company stocks immediately fell because they lost a major revenue stream and could no longer rely on automatic government payments tied to inflated Silver premiums.

With insurer subsidies off the table, policymakers began asking a new question: If we aren’t sending massive federal dollars to insurance companies, where should the money go instead?

This question opened the door to the HSA Option—a different approach that aligns with President Trump’s stated goal: “Send the money to the people.”

4. What President Trump Wants: Putting the Money Directly in Patients’ Hands

President Trump’s healthcare message is simple: if the government is spending money on healthcare, that money should go to patients, not to insurance companies. The HSA Option is the first major proposal that accomplishes this.

The plan has two key parts.

First, it fixes the broken CSR system that previously funneled money to insurers and encouraged higher premiums through “silver-loading.” Correcting this lowers premiums by about 12% and saves taxpayers roughly $30 billion.
Second, instead of sending CSR dollars to insurers, the HSA Option deposits the money directly into patients’ Health Savings Accounts (HSAs)—over $2,000 per year for many families. This money rolls over, grows tax-free, and can be spent using a simple debit card on real care like dental, vision, mental health, labs, imaging, medications, specialists, and Direct Primary Care (DPC).

5. Why This Is Good for Patients

The HSA Option shifts control away from insurers and back to patients.

Instead of insurers deciding networks, deductibles, and how subsidies are used, families can direct their own healthcare dollars.
HSA funds can be used for out-of-network visits, cash-based care, preventive services, and DPC memberships, giving patients access to a much wider range of care options than narrow ACA networks ever allowed.

This also improves incentives.

When the money follows the patient, doctors and clinics must compete on price, value, and service.
Insurers can no longer inflate premiums knowing the government will cover the increase. • Redirecting subsidies into HSAs reduces waste, eliminates phantom enrollments, and ensures every dollar is tied to a real patient receiving real care.
It also supports innovative, patient-centered models like DPC that restore long-term relationships between patients and physicians.

6. Why This Reform Was Possible

Patients gained leverage because Congress declined to bail out insurers with new subsidies. By letting the COVID credits expire and reopening the government without insurer handouts, lawmakers signaled that emergency-era spending would not be made permanent.

This broke the cycle of:

subsidies → higher premiums → higher insurer profits → worse patient access.

With that cycle interrupted, the focus shifted to solutions that empower patients directly.

7. The Pro-Patient Bottom Line

The shutdown ended without giving insurance companies more money, creating space for true patient-centered reform. President Trump’s approach—“send the money to the people”—means healthcare dollars now go directly to patients through HSAs. This allows families to pay for real care, choose the doctors they trust, and use models like Direct Primary Care that restore trust, affordability, and transparency in medicine.

8. Sources

HealthCare.gov – Marketplace eligibility, metal plan levels, and subsidy rules
CMS (Centers for Medicare & Medicaid Services) – ACA enrollment data, CSR information, and plan variations
Kaiser Family Foundation (KFF) – Premium, deductible, and network trend data
CBO (Congressional Budget Office) – Reports on ACA subsidies, CSR payments, and federal spending
GAO (Government Accountability Office) – Reviews of improper payments and CSR funding
U.S. Census Bureau – Current Population Survey (insurance coverage data)
Paragon Health Institute – Research on zero-claim enrollees, fraudulent enrollment, and ACA subsidy effects
Competitive Enterprise Institute (CEI) – Analyses of ACA costs, premiums, and subsidy-driven price inflation