Obamacare subsidies extension clears procedural hurdle in the House

A Democrat-led push to extend recently expired Obamacare subsidies cleared a procedural hurdle in the House on Wednesday with support from nine Republicans, teeing up a final vote later this week.

The House voted 221-205 in favor of a motion to discharge a bill that, if passed by the House and Senate, would extend enhanced tax credits for Affordable Care Act health insurance plan holders for three years. 

Those tax credits were first implemented in 2021 under President Joe Biden as a pandemic-era relief measure and expired at the end of 2025, resulting in premium hikes for millions of Americans. 

Congressional Republicans, who have largely opposed extending the subsidies, find themselves in a difficult position ahead of the 2026 midterms, as Democrats seek to make health care and affordability central campaign issues.

“The American people want us to work on the affordability crisis,” said Rep. Ted Lieu, Democratic Caucus vice chair, at a Wednesday press conference before the vote.

“We know that healthcare costs are skyrocketing, food prices continue to increase and electricity rates in a number of areas are surging,” Lieu said. “And what is Donald Trump focused on? In his words ‘running Venezuela.'”

The House is expected to vote on the underlying measure to extend the ACA enhanced tax credits on Thursday.

House Minority Leader Hakeem Jeffries, D-N.Y., introduced the discharge petition in November after Speaker Mike Johnson, R-La., declined to bring a vote on extending the subsidies. A discharge petition is a procedural tool that allows rank-and-file members to circumvent leadership and force legislation to the floor with majority support.

Over Johnson’s objections, four moderate House Republicans signed the petition in December, lifting Jeffries’ effort over the 218-signature threshold. 

The Republican defections were a blow to Johnson, whose authority was undermined last year by a series of successful discharge petitions, including one that compelled the release of files related to the sex offender Jeffrey Epstein.

Uncertainty in the Senate

But the outlook for the enhanced ACA tax credits across the Capitol remains murky and time is short.

ACA open enrollment in most states ends Jan. 15, though some lawmakers, including Sen. Susan Collins, R-Maine, said Congress could consider extending the election period if a solution does not materialize in time.

The Senate in December rejected a similar measure that would have extended the subsidies for three years. A second attempt at a three-year extension is not expected to fare any better.

Instead, a bipartisan Senate working group has been attempting to find a compromise on the issue. Sen. Bernie Moreno, R-Ohio, among those involved in the talks, said on Wednesday the House bill would fail in the Senate but serve as a vehicle for lawmakers to amend the proposal.

Moreno said they were “in the red zone,” adding that the working group could not afford to drag out negotiations for several more weeks. House and Senate moderates are set to meet Thursday to discuss the enhanced ACA tax credits, Punchbowl News reported Tuesday.

To get majority support in the Senate, any deal will need to take into account several issues that persist. Senate Majority Leader John Thune on Tuesday said that includes addressing $0 premiums, which were expanded in 2021 thanks to the enhanced ACA tax credits, and creating a “bridge” to greater Health Savings Accounts access, which Trump has made a priority.

“An expansion of HSAs so that you’re getting more money into the pockets of the American people, the patients if you will, the consumers, as opposed to the insurance companies,” Thune said.

Perhaps the biggest sticking point is over the Hyde Amendment, a decades-old policy that prohibits the use of federal funds for most abortions that pro-life groups and some Republicans want to strengthen.

At a House GOP retreat on Tuesday, Trump instructed congressional Republicans to be “flexible” on the Hyde Amendment, spurring anger from pro-life groups and push back from staunchly anti-abortion Republicans. 

“We don’t do federal funding for abortions,” Moreno said. “That’s a long-standing tradition, nobody’s looking to change that.”

— CNBC’s Karen Sloane contributed to this report.