White House circulates a plan to extend Obamacare subsidies as Trump
pledges health care fix
[November 25, 2025]
By SEUNG MIN KIM
WASHINGTON (AP) — The White House is circulating a proposal that would
extend subsidies to help consumers pay for coverage under the Affordable
Care Act for two more years, as millions of Americans face spiking
health care costs when the current tax credits are set to expire at the
end of the year.
The draft plan suggests that President Donald Trump is open to extending
a provision of Obamacare as his administration and congressional
Republicans search for a broader policy solution to a fight that has
long flummoxed the party. The White House stresses that no plan is final
until Trump announces it.
The subsidies were at the heart of the Democrats’ demands in the
government shutdown fight that ended earlier this month. Most Democratic
lawmakers had insisted on a straight extension of the tax credits, which
expire at the end of the year as a condition of keeping the government
open.
Eligibility for the Obamacare subsidies, which were put in place during
the COVID-19 pandemic to help people afford health care coverage, would
be capped at 700% of the federal poverty level, according to two people
with knowledge of the proposal. The people spoke to The Associated Press
on condition of anonymity to discuss a White House proposal that is in
draft form.
The baseline tax credits that were originally part of the Affordable
Care Act were capped at 400% of the federal poverty level, but that
cut-off was suspended because of the temporary COVID-era credits that
allowed middle- and higher-income people to benefit from subsidies too.
The White House would also require those on Obamacare, regardless of the
type of coverage, to pay some sort of premium for their Obamacare plans.
That would effectively end zero-premium plans for those with lower
incomes, addressing a concern from Republicans that the program has
enabled fraud. One option is a requirement that everyone pay 2% of their
income, or at least $5 per month, for lower-tier plans.
Even as the White House’s proposal remains in flux, the notion of
extending any part of President Barack Obama’s signature legislative
achievement is likely to rankle conservatives who have sought to repeal
and replace the law for well over a decade.
“Until President Trump makes an announcement himself, any reporting
about the administration’s health care positions is mere speculation,”
White House spokesman Kush Desai said Monday.
White House press secretary Karoline Leavitt told reporters on Monday
afternoon that Trump “is very much involved in these talks” and that he
is “focused on unveiling a health care proposal that will fix the system
and will bring down costs for consumers.”
But there are signs that parts of the nascent White House plan could get
buy-in from Democrats. New Hampshire Sen. Maggie Hassan, one of eight
members of the Senate Democratic caucus who voted to reopen the
government earlier this month, said it “represents a starting point for
serious negotiations.”
“The fact that President Trump is putting forward any offer at all to
extend the Affordable Care Act’s tax credits shows that there is a broad
understanding that inaction in this regard will cause serious harm to
the American people,” Hassan said.
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President Donald Trump talks after meeting with New York City
Mayor-elect Zohran Mamdani in the Oval Office of the White House,
Friday, Nov. 21, 2025, in Washington. (AP Photo/Evan Vucci)
 Fellow New Hampshire Democratic Sen.
Jeanne Shaheen, who led bipartisan efforts to end the government
shutdown, added that “I'm glad the president is reportedly
considering a serious proposal.”
“I’ve had constructive conversations with many of my Republican
colleagues who I believe want to get this done,” Shaheen said. “They
understand that the vast majority of people who benefit from these
tax credits live in states the President won, and that the
President’s own pollsters have underscored the enormous political
urgency of Republicans acting.”
In 2017, Trump fell short in a push to dismantle the Affordable Care
Act, an embarrassing defeat for Republicans who had just seized
control of all levers of power in Washington. The GOP has failed to
coalesce around a unified health care proposal since, and the
expiration of the pandemic-era subsidies gives Trump and his party
an opportunity to put their own stamp on the issue.
As the White House worked quietly on its plan, led by the Domestic
Policy Council, key lawmakers on Capitol Hill have drafted their own
proposals. For instance, Florida Sen. Rick Scott, Louisiana Sen.
Bill Cassidy and others have proposed various ideas for redirecting
the program’s spending on federal subsidies into health savings
accounts that enrollees could use to shop for plans or defray
out-of-pocket costs. Scott's plan has been discussed with the White
House multiple times since it was released Thursday, according to a
person familiar not authorized to discuss the private conversations.
The draft of the White House plan would allow those in lower-tier
plans, such as the bronze-level or catastrophic plans, to put money
into health savings accounts.
It would also codify the “program integrity rule” to further help
root out fraud, waste and abuse.
Americans shopping for Obamacare coverage have already faced the
sticker shock of price hikes, because the window for selecting next
year’s coverage began Nov. 1. Without congressional action, the
average subsidized enrollee will face more than double their current
cost in premiums next year, according to an analysis by the health
care research nonprofit KFF.
Recent national polls have shown Americans are concerned about
health care costs, along with broader affordability issues. Those
concerns played out in elections earlier this month, which swept to
power Democrats whose political messaging focused on the rising cost
of living.
—
Associated Press writers Fatima Hussein and Joey Cappelletti in
Washington and Ali Swenson in New York contributed to this report.
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