Republican U.S. Senator Bill Cassidy of Louisiana speaks to reporters in the Dirksen Senate Office Building on Wednesday, December 3, 2025. (Photo by Jennifer Shutt/States Newsroom)
WASHINGTON – The U.S. Senate committee that oversees health care began agreeing on an approach to lowering costs for Americans at a hearing Wednesday, although several hurdles still lie ahead.
Republicans and Democrats on the panel appeared to accept that expanded tax credits for people who buy health insurance through the Affordable Care Act marketplace should not expire at the end of the year. There are only a few days left for open enrollment and premiums are expected to rise sharply.
Bipartisan momentum from a select group of senators will need to raise significantly in the coming days if a subsidy extension is to quickly gain the 60 votes needed to advance to the Senate and then through the Republican-controlled House.
It also requires President Donald Trump’s signature to become law, and he has not yet signaled support for an extension.
“I hope we can find a bill that gets 60 votes and can resolve the stock market issue for Jan. 1, 2026,” said Bill Cassidy, R-La., chairman of the Health, Education, Labor and Pensions Committee. “It shouldn’t be a Republican solution. It shouldn’t be a Democratic solution. It should be an American solution.”
Cassidy warned the panel’s lawmakers against pushing for “big ideas” and said Congress must “find a solution in three weeks.”
A “political problem” for the GOP
But expanding ACA market subsidies, perhaps with adjustments, is only a short-term solution that the committee’s senators agree must be followed by an overhaul of America’s health care system.
Any effort to pass broader legislation will run into the entrenched politics of the Affordable Care Act, well-funded lobbyists and next year’s midterm elections, which won’t make the process any easier.
Independent Vermont Sen. Bernie Sanders, the panel’s ranking member, said he appreciated Cassidy’s “sense of wanting to do something quickly” but said Republicans should have focused on the expiring ACA tax credits at the beginning of the year instead of leaving it until now.
“The reason for this hearing, to be honest, is that my Republican friends understand that they have a political problem,” Sanders said. “Their policy problem is that today, all across America, people who follow the Affordable Care Act are opening packages from insurance companies, and guess what? Their premiums are doubling on average, and in my state they’re tripling or quadrupling in some cases.”
Sanders said Congress should extend the expanded ACA market tax credits for another year, two or three years while lawmakers address larger, structural issues surrounding health care costs.
“Yes, the current system is broken. Yes, we need to create a new system,” Sanders said. “But unfortunately we can’t do it in two weeks.”
Sanders suggested the committee hold a series of hearings in the coming months with leaders from other developed countries that provide health care to all their residents.
Extension of tax credits discussed
Maine Republican Sen. Susan Collins said “there’s a limit to what we can do in this first year” and that lawmakers “are going to need a two-year plan.”
Collins indicated that she would like to see “reasonable” income caps to limit eligibility for ACA marketplace tax credits under a short-term extension that Congress could pass.
Washington state Democratic Sen. Patty Murray said Republicans stern about addressing ACA cost increases should work with Democrats to pass a “clean, one-year extension” of the increased subsidies.
“And if their call for tax credit reform is serious, we should look at it. We can talk about those reforms before 2027,” Murray said. “But I have to say, I’m not optimistic that most Republicans are serious about it because they’ve refused to talk about this issue, and I’ve been down this road before.”
Murray also chided Cassidy for failing to draw the committee’s attention to the expiring tax credits earlier this year by taking a swipe at his vote to confirm Health and Human Services Secretary Robert F. Kennedy Jr.
“That’s about as serious as expressing concern about RFK Jr.’s anti-vaccination crusade after he voted to make him the most powerful public health official in the country,” Murray said.
“Appropriate caps” are supported
Alaska Republican Sen. Lisa Murkowski said committee members need to focus on what Americans’ health care costs will look like in the next few months and years.
“I think we’re going to need a short-term extension. But I think we can set reasonable caps. I think we can set some of the parameters that we’ve talked about. There’s no big mystery here about how we’re going to deal with this particular dilemma that we’re in,” Murkowski said. “But we need to think about it longer term: How can we ultimately reduce these costs of care?”
Murkowski said she was also concerned about a decline in funding for public health and prevention initiatives before asking witnesses appearing before the committee what their top recommendations would be for “prevention programs that have the strongest evidence for reducing long-term costs.”
Joel White, president of the Council for Affordable Health Coverage in Washington, D.C., said Congress should allow “premium discounts in the individual wellness program market,” which he said is currently illegal.
Marcie Strouse, owner and partner at Capitol Benefits Group in Des Moines, Iowa, suggested lawmakers open health savings accounts “to provide more holistic and preventative services.” She also said Congress could emphasize “direct primary care and making sure people actually get the care they need.”
Dr. Claudia M. Fegan, national coordinator at Physicians for a National Health Program in Chicago, suggested improved primary care and screening for diseases such as cancer, which are easier to treat if caught early.
Wisconsin Democratic Sen. Tammy Baldwin said the hearing clearly showed that there was “fundamental agreement that this system requires comprehensive reform.”
But, she said, Congress needs to take a look at the entire health care system, not just the Affordable Care Act.
“I want to point out that just under 50% of Americans get their health insurance through employers or group plans, 20% through Medicaid, 15% through Medicare, 1% through TRICARE or VA, and just over 6% in this market,” Baldwin said. “There are problems with this market. But I have to say that abandoning the ACA … will not solve the system as a whole.”
Republican Sen. Jon Husted of Ohio appeared to support a short-term extension of expanded ACA tax credits to give Congress more time to address larger health care affordability issues.
“We can freeze the subsidies at current levels for a temporary period. I don’t know if that’s one year or two years to provide some relief,” he said. “By the way, just because we maintain these tax credits doesn’t reduce costs. The burden is shifted to taxpayers and future generations. But it’s a small help right now that we can both agree on. And then we have to fix the problem.”
Husted said there are easily a dozen bills Congress could pass one at a time to begin reducing health care costs.
Hawley offers a plan to exempt health care costs
Republican Sen. Josh Hawley of Missouri also appeared to support a short-term extension of the expanded ACA market tax credits.
“We are facing a massive crisis if Congress does not step up and act soon,” Hawley said. “And my message is to the leadership of this body – to the leaders of the House, the leaders of the Senate – maybe it’s time for us all to get together in a room and come to a solution here.”
Halwey introduced a bill he had just introduced to exempt health care from taxes.
“If you pay premiums, you should be able to deduct them on your taxes. If you pay out-of-pocket medical costs, you should be able to deduct every dollar on your taxes. You want to reduce the cost of health care immediately. Do that. No taxes on health care for every American,” Hawley said. “And you put a cap on it so rich people don’t game the system. I get it. That’s fine. But let’s think about the working people in this country who can’t afford health care.”
Hawley said it should be allowed whether an American itemizes their taxes or not.
All three panelists initially seemed to support the idea.
Renewal of tax credits in 2026
Cassidy said afterward the two-hour hearing He is working to gain support from lawmakers from both political parties for an integrated approach next year.
“You could apply the proceeds that would be used to extend the subsidies to the Bronze plan because the Bronze plan is much cheaper. You could then put the balance into the health savings account,” Cassidy said, referring to the coverage levels in plans on the ACA Marketplace. “So it continues the support with the mechanisms in place, but integrates the HSA, which provides first-dollar coverage and could potentially lower the net deductible.”
Cassidy said Congress could extend the ACA marketplace open enrollment period and then fund health savings accounts, which are tax-advantaged savings accounts, before the end of March.
“People would keep their receipts and submit them for payment,” he said. “People do that all the time.”
