May 30th, 2025 – The recently passed “One Big Beautiful Bill” (H.R. 1) introduces significant changes to the U.S. healthcare landscape. While the bill is far reaching, its implications for employer-sponsored health insurance, individual health insurance and Affordable Care Act (ACA) premium tax credits are significant.

Colorado residents will want to understand how the bill’s changes, if turned into law, might affect your healthcare coverage and costs.

1. Changes to ACA Premium Tax Credits

One of the most impactful aspects of H.R. 1 is the alteration of ACA premium tax credits:

• Expiration of Enhanced Subsidies: The enhanced federal premium tax credits, which significantly reduced premiums for many, are set to expire after 2025. This change could lead to increased premiums for millions of Americans.

• Increased Out-of-Pocket Costs: The bill repeals cost-sharing subsidies that helped lower deductibles and other out-of-pocket expenses for lower income individuals. 

2. Impact on the Individual Health Insurance Market

The individual health insurance market is poised to experience several shifts:

• Potential Premium Increases: With the rollback of subsidies and cost-sharing reductions, Coloradans who received these benefits previously will pay more for both premiums and health care out of pocket costs. 

• Reduced Enrollment: Higher costs could lead to an increase in the uninsured, reversing gains made in recent years.

3. Effects on Employer-Sponsored Health Insurance

While H.R. 1 doesn’t directly overhaul employer-sponsored insurance, there are indirect effects:

• Maintained “Firewall”: The ACA’s provision that prevents employees with access to “affordable” employer coverage from receiving marketplace subsidies remains intact. 

4. Broader Healthcare Implications

Beyond insurance markets, H.R. 1 introduces other healthcare-related changes:

• Medicaid Adjustments: The bill imposes work requirements and increased eligibility verifications for Medicaid recipients, potentially reducing enrollment.

• Health Savings Accounts (HSAs): H.R. 1 expands HSA benefits, allowing more individuals, including Medicare Part A recipients, to contribute. It could also expand HSA qualified plans to all Bronze and Catastrophic ACA plans. The new provision would clarify for those 55 years old and older that both spouses can make their 55+ catch-up contributions to the same HSA. It also broadens the scope of qualified expenses to include fitness expenses up to $500 for singles and $1000 for families, excluding golf, hunting, sailing and horseback riding.

5. New Flexibility for Employers: Tax-Free Contributions to Individual Market Plans

• H.R. 1 codifies Individual Coverage Health Reimbursement Arrangements (ICHRAs). ICHRA’s allow employers to offer tax-free contributions to employees for purchasing individual health insurance plans. However, employees should be aware that accepting an ICHRA offer may affect their eligibility for ACA premium tax credits, depending on the affordability of the employer’s contribution.

What This Means for Colorado Residents

Colorado has been proactive in expanding healthcare access, but the federal changes introduced by H.R. 1 could pose challenges:

• Increased Costs: Individuals that buy their own health insurance may face higher premiums and out-of-pocket expenses, especially if they previously benefited from enhanced subsidies.

• Coverage Decisions: With potential changes in employer-sponsored plans and individual market affordability, Coloradans might need to reassess their coverage options.

• Medicaid Considerations: Those relying on Medicaid should stay informed about new eligibility requirements to ensure continued coverage.

Given these possible changes, it’s crucial to understand how H.R. 1 might affect your premiums and out-of-pocket costs and stay abreast of both federal and state-level healthcare policy changes that may impact your insurance options.

At Colorado Health Insurance Brokers, we’re committed to helping you navigate these complex changes. Our experts are here to provide personalized guidance to ensure you have the business or individual coverage that best fits your needs and budget.