GOP’s Shutdown Win May Backfire Over Soaring Health-Care Costs

(Bloomberg) — Republicans, fresh off their US government shutdown victory, now face the task of sorting a health-care mess that risks upending the balance of power in President Donald Trump’s Washington.

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The moves by GOP leaders to resist Democrats’ demands to protect expiring subsidies for Obamacare as the price for reopening federal agencies will save the government billions of dollars and weaken a program the party has tried repeatedly to kill.

But with millions of Americans now facing a spike in health care premium costs at the start of next year, the issue could quickly become a drag on Republicans in the 2026 midterm elections.

Democrats are already sharpening their pitch to voters, seizing the affordability mantle that Trump carried in his 2024 presidential campaign but has struggled to realize in a second term focused more on international affairs than bread-and-butter issues. Rising premiums — which are doubling or tripling for some Americans — will feed Democrats’ narrative.

“Costs aren’t going down for the American people under Republican complete control of government. Costs are going up. Housing costs up. Grocery costs up. Electricity bills through the roof,” House Democratic leader Hakeem Jeffries said this week. “And now because of the Republican refusal to extend the Affordable Care Act tax credits, tens of millions of Americans are about to experience dramatically increased premiums.”

Traditionally, the parties of incumbent presidents fare badly in midterm elections — a fate Trump, who has leveraged control of Congress to push through his agenda with little resistance, is eager to avoid.

Republicans now have slim margins in the House and Democrats will exploit any weaknesses to seize control of that chamber. The path for Democrats is more difficult in the Senate, but voter frustration with the cost of living and the broader economy could lead to some surprises.

Senator Thom Tillis of North Carolina, who is retiring, warned his Republican colleagues that they’re courting political disaster next year if they don’t extend the health care subsidies or moderate Trump’s deep cuts to Medicaid, a program for low-income and disabled Americans.

“It is a very, very negative set of political headwinds for Republicans next year,” Tillis told Bloomberg Government last month. “The House is absolutely in play.”

Pocketbook Issue

Some 24 million people on Affordable Care Act insurance face health care premiums soaring an average of 114%. Millions more are expected to lose Medicaid when the cuts in Trump’s “big beautiful bill” kick in just after the midterm elections.

Those fiscal savings can carry a heavy political cost. Even a failed effort by Trump to slash Obamacare’s subsidies and benefits in 2017 helped power a Democratic takeover of the House a year later, and Democratic leaders are counting on history to rhyme.

Republicans already have reason to worry after suffering big election losses last week in New Jersey, Virginia, California and Georgia, with polls finding most voters blamed the GOP for the shutdown. Surveys also show strong majorities of people support extending the health care subsidies and are unhappy with the economy.

Tillis defeated Democrat Kay Hagan in 2014 because of the early backlash to Obamacare, but the program has aged well with many Americans. Nearly a dozen years later, Tillis — one of just three Republicans to vote against Trump’s legislative centerpiece because of the Medicaid cuts — now worries health care will boomerang on his party.

“You cast the deciding vote for the big beautiful bill and you’re a rubber stamp for Donald Trump is a real risk for people going into an election cycle next year,” he said.

Trump’s Choice

Republicans argue that unaffordable premiums show Obamacare is failing and should be replaced. The problem for the GOP is that 15 years after its passage they still haven’t been able to agree on exactly what that replacement plan should be.

Senate Majority Leader John Thune has promised Democrats they’ll get a vote on extending the subsidies by mid-December, and told reporters he hopes a deal comes together soon. But any outcome hinges on Trump, who used much of his first-term political capital trying to kill Obamacare.

House Speaker Mike Johnson has refused to promise any such vote, and there’s no realistic prospect that an extension can be enacted over a presidential veto. Republicans point to the cost of renewing the tax credits as a problem.

Democrats “had the opportunity to make them permanent, and they didn’t do it because they couldn’t find the money to pay for it,” Representative Sam Graves, a Missouri Republican, told Fox Business in an interview Thursday.

Trump and many Republicans, including Senator Ted Cruz of Texas, have proposed government-funded health savings accounts to replace the subsidies, which go directly to insurance companies. Other Republicans are calling for a wholesale reworking of the law, including eliminating or shrinking the mandated benefits, which include coverage of maternity care, pre-existing conditions, hospitalization and prescription drugs. They’re also eyeing abortion restrictions.

Representative Adelita Grijalva, an Arizona Democrat, said the onus is on Republicans — not Democrats — to come up with ways to improve the ACA.

“Republicans have had critical things to say about the Affordable Care Act since its inception in 2010. They have had 15 years to work on a better plan but all they do is throw stones,” she said Thursday in an interview with Bloomberg Television.

Senator Jeanne Shaheen of New Hampshire, the retiring Democrat who helped broker the deal to reopen the government, has suggested a compromise that would include phasing out the subsidies for people making more than $200,000 a year. She has support from some moderate Republicans, including Susan Collins of Maine, whose Senate seat is a must-win for the party.

Forging a deal could be important for Collins’ effort to win a sixth term next year in Maine; the powerful chairwoman of the Appropriations Committee is the one Republican incumbent running next year in a state won by Democrat Kamala Harris in 2024.

Collins said on the Senate floor that Obamacare has been “anything but affordable,” but said the tax credits should be extended for low- and middle-income people.

Other Republicans facing reelection fights next year where Democrats are certain to focus on health care include appointed Senator Jon Husted in Ohio, appointed Senator Ashley Moody of Florida, Dan Sullivan of Alaska and John Cornyn in Texas.

Husted faces a comeback bid from populist Democrat Sherrod Brown. Moody and Cornyn represent two of the states with the highest percentages of residents on Obamacare plans. Meanwhile, some in Sullivan’s Alaska face premium hikes of as much as $4,000 a month. The impact hits hardest for older people who aren’t yet eligible for Medicare and make just above 400% of the poverty level — the cap for receiving the original subsidies, which will continue.

In the House, 15 Republicans have signed on to a bill to extend the subsidies for a year, including vulnerable incumbents Jen Kiggans of Virginia and Mike Lawler of New York. But so far they have failed to convince their GOP colleagues — or Trump.

Kiggans and some other Republicans had also pushed to preserve tax credits for renewable energy, but voted for the bill gutting them anyway.

–With assistance from Hadriana Lowenkron, Joe Mathieu and Tyler Kendall.

(Updates with Grijalva remarks in 20th paragraph.)

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