Buried in the fine print of Obamacare regulations, the Trump administration is floating a novel idea for those who can’t afford to shell out tens of thousands of dollars in out-of-pocket medical costs.
Why not borrow the money from your health insurance company?
In the dense 1,121-page final rule issued last month about how the Affordable Care Act market will operate next year, the administration suggested that insurers consider offering loans to cash-strapped customers.
Under this approach, people who develop a costly disease or need unexpected emergency care would be able to turn to their health insurer for loans to cover their share of the bill. The debt, though, would have to be repaid, presumably with interest.
Trump administration officials say the idea is a way to help people who chose a plan with a low monthly premium and high out-of-pocket costs, but unexpectedly encounter a devastating medical bill.
At a time when more than a third of American households already have some kind of medical debt, experts expressed dismay at the possibility of adding to the strained budgets of people already dealing with higher health care costs.
“The last thing you want to do is to increase deductibles and load people up with more medical debt,” said Neale Mahoney, an economist at Stanford University. “It seems to be hugely out of touch with where people are.”
Kathleen Capetta, 43, and her husband and three children are insured through the Affordable Care Act. This year, she chose a plan that costs $2,600 a month, about $750 more than it did last year.
In October 2023, she was diagnosed with breast cancer. “I am living — thank God — proof that it is truly a roll of the dice,” she said.
Ms. Capetta, a media consultant in Camden, Maine, estimates that she has spent tens of thousands of dollars between insurance payments and out-of-pocket costs. She already owes the local hospital group nearly $1,000 a month for care, part of a no-interest payment plan.
Her savings have been decimated. “I’m not sure what people are supposed to do,” Ms. Capetta said.
The Trump administration has been trying to promote ways to address the increased cost of A.C.A. plans fueled by the Republican-controlled Congress’s decision last year to end additional federal tax credits, the more generous subsidies. Those subsidies significantly reduced the cost of Americans’ premiums.
Depending on your age and where you live, what you pay can vary widely. On average, this year Obamacare plan premiums are $178 a month, compared with $113 a month in 2025, according to a recent analysis from KFF, a health care research group.
The average annual deductible is now nearly $4,000 a person, according to KFF. About 40 percent of people with Obamacare have signed up for its Bronze plans, a level of coverage that carries an out-of-pocket maximum exceeding $10,000 for an individual. People with low incomes can use the remaining subsidies to buy plans designed to protect them from high out-of-pocket costs.
Federal officials are pushing even skinnier plans that require people to pay more of their medical costs as a way to bring down the monthly cost of premiums next year.
Under the new rule, some plans that require families to pay tens of thousands of dollars in out-of-pocket costs will be allowed. In 2027, more people will be eligible for bare-bones plans that offer catastrophic coverage, which pay for major illnesses but not day-to-day medical care. The following year, a family will be able to buy a catastrophic plan with a deductible of more than $31,000, and should pay much lower monthly premiums than this year’s.
Chris Krepich, a spokesman for the Centers for Medicare and Medicaid Services, which oversees the Affordable Care Act, defended the broadening array of plans and the suggestion of a loan program.
The catastrophic plans, he said, may be especially important for people who are not eligible for subsidies or cannot afford the cost of a more traditional plan. With insurers allowed to offer loans, patients would be able to spread out payments for high medical bills that occurred before they reached a plan’s deductible, Mr. Krepich said.
A lending option offered by insurers is essentially a workaround to mitigate the high cost of A.C.A. plans, said Joel White, a health care consultant who advises Republicans. “With a higher deductible, you get a lower premium,” he said. “People are looking for any kind of relief.”
Under the law, insurers have little leeway to be creative in the kind of plans they sell, according to Mr. White, and the Trump administration is attempting to encourage companies to develop new types of plans that better meet people’s needs.
“We’ve regulated this market to death,” he said.
Several cities, health care professionals and others have already sued the administration’s changes to the Affordable Care Act for this year, successfully blocking aspects of the regulations. The plaintiffs contend that the rules would make enrollment more difficult.
Many of the same organizations also are now challenging some provisions for next year, including expanding eligibility for a catastrophic plan.
“Rather than making coverage more affordable or removing barriers to obtaining quality health coverage,” the plaintiffs argued in the new lawsuit, “the rule will almost certainly cause at least three million Americans to lose coverage on the A.C.A.’s health insurance exchanges in 2026 alone and will result in higher premiums and higher out-of-pocket costs for the remaining enrollees.”
The Centers for Medicare and Medicaid Services would not comment on active litigation.
It’s too early to tell whether insurance companies will become lenders. “I’m kind of skeptical there will be any significant interest, both on the insurance and the consumer ends,” said Louise Norris, a policy analyst for healthinsurance.org, an information and referral site.
At least one insurer is equipped to start lending customers the money to cover big medical bills: UnitedHealth Group, the giant that owns the nation’s largest health insurer. The company operates a bank through its Optum unit, which offers health savings accounts, where people can accumulate pretax money to pay for medical expenses, and also lends money to doctors.
A UnitedHealth spokesman declined to comment on whether it would consider giving loans to people enrolled in its insurance plans.
Chris Bond, a senior vice president for AHIP, a trade group for insurance companies, said in a statement that insurers “are always evaluating other innovative ways to promote affordability.’’
Proponents of having consumers bear more costs say skimpier plans encourage comparative shopping.
But those plans have also been found to deter people from seeking care and can burden the sick with considerable medical debt.
“In multiple studies, we have found that Americans with medical debt are less likely to receive medical care and more likely to forgo or delay medical care, dental care and mental health care,” said Catherine Ettman, a researcher at Johns Hopkins University.
And soaring medical bills are not limited to people insured under the A.C.A. Deductibles for most employer-based plans may not be as high as A.C.A. plans, but one in five workers has an individual deductible of at least $3,000, according to KFF.
David Stahl, 48, a schoolteacher in Castroville, Calif., chose a high-deductible plan from his employer. He puts $875 a month into a health savings account that he uses to pay his out-of-pocket costs. He rarely, if ever, sees a doctor.
“We did the math,” Mr. Stahl said. “If you don’t use health care, it makes much more sense to use the H.S.A.”
But unforeseen accidents outstripped those savings because he had a $10,000 deductible. His son broke his arm, and he dislocated his shoulder. A trip to the emergency room alone cost $7,400. Mr. Stahl is now paying the hospital $175 a month to cover his bills.
In the end, A.C.A. catastrophic plans may not become popular. About 67,500 people enrolled in one this year. These policies require people to spend about $10,000 for an individual and $20,000 for a family before insurance kicks in.
People can’t use subsidies to buy the plans, said Katie Keith, a research professor at Georgetown University who has written extensively about the new rule. Even if they are more widely available, people without extra cash may be turned off by the skimpy coverage.
Dr. John W. Scott, a trauma surgeon and health services researcher at the University of Washington, said that borrowing money for medical care would not address the fundamental issue of rising health care expenses for the average household.
In a recent study of patients with emergency medical conditions requiring surgery, he found that people with a high-deductible plan showed up late with more acute symptoms because they had waited to get help.
Offering loans through insurers, Dr. Scott said, “seems to be a restructuring of who they owe the debt to, and that is the opposite of a solution.”
