Biden Versus Trump on Health Care
The core dispute likely to lead to a government closure
Biden Versus Trump on Health Care
The contrasting approaches of the Biden and Trump administrations reveal two very different philosophies about the role of government in the U.S. health care system.
President Biden’s health care policy has been characterized by incremental expansions within the framework of the Affordable Care Act (ACA). His administration made premium tax credits more generous, eliminated the so-called “subsidy cliff” at 400 percent of the federal poverty level (FPL), and extended new assistance to middle-income families who had previously received little or no support. These provisions, however, are temporary and set to expire at the end of 2025. Medicaid enrollment also rose during Biden’s tenure, aided by the American Rescue Plan Act’s financial incentives and temporary increases in the federal Medicaid match (FMAP) for expansion states. The pandemic-era continuous coverage requirement prevented states from disenrolling beneficiaries and further swelled Medicaid rolls, though that protection lapsed in 2023, triggering a wave of redeterminations and disenrollments.
Biden also worked to strengthen exchange markets while leaving the employer-based system largely intact. A central move was the 2022 affordability rule change, often described as the “family glitch” fix, which allowed dependents of workers with employer coverage to qualify for exchange subsidies if that coverage was unaffordable. His administration reversed Trump-era policies that had expanded short-term health plans, narrowing their availability in an effort to keep healthier individuals within ACA-compliant exchanges.
By contrast, Trump’s health care policies emphasized retrenchment and deregulation. Several Medicaid provisions established or expanded under Biden were rolled back or scheduled for phase-out. The continuous coverage requirement ended with the public health emergency in 2023, and the ARPA incentives for expansion states are sunsetting. Moreover, a number of states maintain trigger laws that automatically end or freeze Medicaid expansion if the federal match rate drops below 90 percent or if federal funding is withdrawn, leaving millions of enrollees at risk.
Regulatory shifts were a central theme of Trump’s approach. His administration and congressional allies have signaled no intention to extend the enhanced premium tax credits, allowing them to lapse automatically at the end of 2025—a point of contention in the current budget and shutdown debates. Trump also expanded the use of short-term, limited-duration insurance plans, relaxed federal oversight of insurers on issues like prior authorization and network adequacy, and emphasized cutting government spending while reducing federal involvement in health care markets.
Another signature policy of the Trump era was the expansion of Health Savings Accounts (HSAs). These tax-advantaged accounts are most beneficial to higher-income households, who can afford to make larger contributions and reap the greatest tax savings. Democrats, however, did not attempt to shape the HSA debate, focusing their energy on other priorities such as premium subsidies and Medicaid expansion.
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Issues and Strategic Missteps
To Biden’s credit, his health care agenda produced tangible gains. The enhanced premium tax credits drove down premiums across exchange plans, reduced the uninsured rate to near-record lows, and expanded affordability for middle-income families who had been priced out of coverage. Medicaid enrollment also reached historic highs, aided by ARPA incentives and the pandemic-era continuous coverage requirement. By some estimates, more than five million additional people gained insurance during his first term, a meaningful achievement in a system where slow growth is the norm.
Yet Biden also miscalculated the political durability of these gains. The decision to structure the premium tax credit expansion as temporary — expiring at the end of 2025 — left the reform hostage to congressional bargaining. Rather than embedding the ACA’s subsidy expansions, his health care accomplishments now depend on future political majorities. In retrospect, one must ask whether the administration made a tactical error in Build Back Better: would it have been wiser to scale back certain ambitious spending proposals to lock in permanence for a narrower suite of health policy gains? Ensuring the premium credit expansion’s durability — even at a reduced scale — might have left a more lasting mark than a bundle of temporary policies.
And the stakes are high. If the enhanced premium tax credits expire, out-of-pocket premiums for enrollees could rise sharply. For example, KFF estimates that a 27-year-old earning $35,000 (about 224 % of poverty) would see his premium for a benchmark Silver plan go from $1,033 to $2,615 — a $1,582 increase (153 %) in annual cost. Likewise, insurers nationwide are requesting median rate hikes of 18 % for 2026, partly in anticipation of the expiration of enhanced credits.
Also, consider a single individual earning $58,320 a year — roughly 400 percent of the federal poverty level in 2023. Before Biden’s reform, this person faced the full sticker price of an ACA benchmark Silver plan, which could easily exceed $8,000 to $9,000 annually in many states, consuming nearly 15 percent of income. Eliminating the “subsidy cliff” allowed this household to receive tax credits that capped premiums at about 8.5 percent of income — reducing the annual burden by several thousand dollars. This is not a “rich” household by any stretch; it is a middle-class worker for whom health care costs can make the difference between stability and financial strain. It is deeply frustrating that Democrats and Republicans cannot agree to sustain such a commonsense protection, leaving families once again exposed to the whims of partisan politics. For larger households at the same income threshold, the dollar impact of eliminating the cliff is even greater.
For Trump and congressional Republicans, the central legislative vehicle — the so-called “big, beautiful bill” — embodied the push to scale back federal commitments to health care. Early versions included deep Medicaid cuts, though this element provoked resistance not only from Democrats but also from centrist Republicans and some conservatives such as Senator Josh Hawley of Missouri, who recognized that Medicaid expansion remains popular in their states. The political backlash underscored the difficulty of rolling back benefits once millions of residents have come to rely on them.
What is striking, however, is that the bill targeted both Medicaid and exchange subsidies simultaneously. Medicaid has long functioned as a counter-cyclical program, expanding during downturns when family incomes fall. Cutting Medicaid eligibility while also curtailing premium tax credits is highly unusual, because the two programs are often substitutes: reductions in subsidies drive more households to seek Medicaid, while Medicaid enrollment losses can increase demand for subsidized exchange coverage. Weakening both at the same time creates a policy contradiction that risks leaving entire populations without affordable alternatives.
This raises the broader question: is there no constituency within the Republican coalition seeking a durable compromise? The instinct to reduce federal spending has overshadowed the pragmatic reality that Medicaid and ACA subsidies function as safety valves in an unstable employer-based system. By moving to cut both pillars, Trump and Republican leadership risk not only increasing the uninsured rate but also leaving themselves politically exposed in swing states where Medicaid expansion is deeply entrenched.
The two parties also remain locked in a persistent dispute over short-term health plans. Here I side with the Democrats. These plans are often marketed as low-cost alternatives, but they provide little real protection. They exclude essential health benefits such as maternity care, prescription drugs, and mental health services; they expose families to catastrophic bills through low benefit caps and the absence of out-of-pocket limits; and they allow insurers to rescind coverage or deny claims based on preexisting conditions. In practice, short-term plans function less like genuine insurance and more like a financial trap, leaving enrollees effectively uninsured when serious illness strikes.