For more than 1 million Houstonians, the argument in Washington over Affordable Care Act subsidies hits close to home.
Federal data shows a large and rapidly rising number of Houston residents are enrolled in an Affordable Care Act marketplace health insurance plan — commonly known as “Obamacare” — with “enhanced” tax credits, which have lowered annual out-of-pocket premiums by hundreds of dollars on average. The credits, combined with much larger federal subsidies, drop their premiums from about $600 to $40 per month on average.
The figures, published by the Centers for Medicare & Medicaid Services, speak to the enormous stakes of a contentious showdown in Congress, where lawmakers are debating if or how to extend the enhanced tax credits set to expire at the end of the year. If Houston follows national trends, tens of thousands of local residents might drop their Obamacare plan and go uninsured each year if the tax credits aren’t extended, according to Congressional Budget Office projections.
“At the end of the road, when people need care but don’t have the coverage, they will delay seeking care and their health problems get worse and more expensive,” said Luz Maria Garcini, director of the Kinder Institute for Urban Research’s Center for Community and Public Health.
“Disruptions in health care coverage push people to use emergency rooms, where care is more costly to the system. It has to start with prevention. Regular screenings, exams and access to preventive guidance and resources are proven tools to avoid bigger health problems, which means people need affordable care from the start."
The enhanced tax credits, which were enacted in 2021 amid the pandemic, lowered the maximum percentage of a person or family’s income they can be required to pay in premiums and expanded the credit to more middle-income households. KFF, a nonpartisan health care research organization, estimates that eliminating the enhanced tax credit would raise premiums nationwide by about $1,000 on average, though each customer’s amount varies by income level and household size.
Republicans generally want to eliminate or change the enhanced tax credits, often arguing they’re too expensive — $350 billion over 10 years, according to Congressional Budget Office projections — and push the government even deeper into the health care business. Democrats support extending the tax credits to help more Americans get and keep low-cost health insurance. The stalemate led to a government shutdown Wednesday, as both parties tied their willingness to pass required budget bills to their Obamacare subsidy stance.
Here’s how Obamacare became such a large part of the Houston health insurance landscape and where the biggest impact from potential changes would be felt.
Obamacare enrollment takes off
For the latter half of the 2010s, a small fraction of Houstonians signed up for Affordable Care Act plans.
Then, in 2021, enrollment took off locally and nationally for several reasons. Congress expanded eligibility for tax credits in light of the pandemic. Employer-sponsored insurance plans became more expensive. Federal and state leaders tweaked eligibility and tax credit rules. More insurers joined the Obamacare market. Public communication about marketplace plans also picked up, particularly in Latino communities.
“That education allowed more people — including communities with historically the highest uninsurance rates — to understand coverage options and get insured,” Garcini said.
In the eight-county Houston area, nearly 300,000 people enrolled in an Obamacare plan subsidized by tax credits in 2020. This year, that tally totaled about 1.1 million. (Another 53,000 area residents signed up for Obamacare plans but didn’t get a tax credit.)
Enrollment in subsidized plans increased across the region, albeit at different rates. Interest skyrocketed in three smaller suburban counties — Chambers, Liberty and Waller — while sign-ups doubled or tripled throughout the rest of the area.
Who enrolls in ACA plans
In Houston and across the country, the large majority of Obamacare marketplace customers live just above the federal poverty line.
Locally, about three-quarters of those insured through Obamacare in 2025 reported a household income in 2024 of 100% to 200% of the poverty line. For an individual, that meant an income of $15,060 to $30,120. For a family of four, it was $31,200 to $62,400.
Obamacare enrollment also spans a wide range of ages in Houston. About 150,000 children received health insurance through marketplace plans, while younger and middle-aged adults counted for the largest share of enrollees.
