The transition to a new presidential administration often brings significant changes to policies that affect businesses and individuals alike. With President Donald Trump now in his second term, many aspects of the health insurance industry will continue to be shaped by new legislation.
Small businesses and independent insurance agencies, like ours at Advanced Benefit Solutions, must prepare for how these shifts could continue influencing health plans, premium costs, and subsidies.
Part of our role as insurance experts is to help educate and inform you on your options and how legislation may impact your budget and your business in the coming months and years. Prepare now, and stay tuned for more updates as legislation changes! For today, we’ll share what we know and anticipate in the market ourselves.
The Potential for Changes in Tax Credits and Subsidies
One of the primary areas of concern for both individuals and businesses is the future of subsidies and tax credits that impact health insurance premiums. Under the Affordable Care Act (ACA), many individuals have relied on premium tax credits to offset the cost of coverage.
These enhanced ACA subsidies passed under the Biden administration are set to expire at the end of 2025. It is possible that there may be a significant reduction in these subsidies, which could lead to higher out-of-pocket costs for many policyholders. However, nothing has been decided just yet. It’s more important than ever to stay in touch with a reputable health insurance expert like our team at Advanced Benefit Solutions so you know what your options are!
What does this mean for employers? Higher premiums on the exchange could translate to increased enrollment in employer-sponsored coverage. Similarly, if families have dependents covered by Medicaid that are at risk of losing coverage, they might look into options for access to insurance through employers. This could mean changes for your employee demographics.
The Expansion of Short-Term Health Plans
One of the more notable policy changes from the first Trump presidency was the expansion of short-term health insurance plans. These plans offer lower premiums but come with significant limitations, such as exclusions for pre-existing conditions and reduced coverage benefits.
If policies continue to favor short-term plans, more individuals and small businesses may be drawn to these options due to affordability. These types of plans can be appropriate for a group of healthier enrollees or someone who needs a temporary solution, but businesses should review these types of health plans to be sure that this coverage is appropriate for the needs of their group. What short-term health plans will look like in the future has yet to be determined.
Employer-Sponsored Health Insurance Considerations
For small businesses offering employer-sponsored health plans, potential deregulation efforts could impact coverage mandates. Trump’s administration encouraged more flexible employer-sponsored options, including association health plans (AHPs), which allowed small businesses to band together for coverage.
While AHPs provided more choices, they sometimes lacked comprehensive benefits compared to ACA-compliant plans. If you want to explore an AHP or a short-term health plan, be sure to discuss with your broker so you know exactly what the current guidelines are.
Potential Cost Implications for Small Businesses
It’s no secret costs in healthcare (and consequently copays, deductibles, and premiums) continue to rise. Small businesses may continue to see fluctuating premium costs. The relaxation of insurance regulations could lead to more competitive pricing for certain employer-sponsored plans, but it may also increase instability in the market.
Additionally, businesses that currently benefit from tax deductions for offering insurance may find those incentives diminishing over time, affecting their ability to attract and retain top talent.
Price Transparency
One common theme in both previous and current administrations is the need for healthcare price transparency. Employers can use data that is now available because of these rules to make more informed decisions about their health plans. Educate employees, negotiate for a better rate, or even explore lower-cost points of care.
Preparing for the Future
There is still a lot of uncertainty regarding health insurance for next year and beyond, but we do know that costs continue to rise, which means it is more important than ever to be efficient (make sure your chosen health plan meets your needs!) and educate employees on how to utilize their benefits.
The out-of-pocket maximum in 2026 will be $10,150 for individuals and $20,300 for families. This is a 10.3% increase from the 2025 limits. President Trump has also proposed a shortening of the annual open enrollment period, which means individuals and businesses need to be prepared to make decisions quickly.
As an independent insurance agency, we know how important it is to stay informed about potential legislative changes. Every business is individual and that’s how we approach each of our clients, too.
As the rest of these developments continue to unfold, here is what businesses and individuals should do:
- Monitor policy updates to understand how tax credits and subsidies may be affected.
- Explore a variety of health plan options, balancing cost with comprehensive coverage.
- Stay engaged with insurance professionals to navigate regulatory shifts.
With the ever-evolving landscape of policy impacting health insurance, the best strategy for individuals and businesses is to remain adaptable. Whether future administrations strengthen or roll back existing healthcare frameworks, working closely with an experienced insurance brokerage like Advanced Benefit Solutions can help ensure the right coverage decisions are made for long-term financial and health security.
Things Will Change
What do we know about the future of health insurance in the United States? We know things will continue to change! We aren’t sure just yet what will happen to subsidies, plan premiums, and what options will be available each year.
This is why it is so important to do your due diligence (or let us handle it!) and reevaluate your options each year. You could be leaving money on the table, and there might be a better option for less that will meet the needs of your employees!
If you haven’t offered employee health benefits before and want to talk to us without any obligation to move forward, get in touch with us today.