President Obama’s signature health care law, the Affordable Care Act (ACA), has now been shaping the private health insurance market for over a decade. The law survived several repeal efforts by Republicans. And then-President Biden twice delivered temporary expansions of subsidies offered under the law for the purchase of insurance. Despite its political staying power, however, the ACA has failed to meet the early promises of its proponents.
Until the pandemic led to temporary expanded subsidies, enrollment remained far below what was expected from the law. In 2010, the Congressional Budget Office (CBO) predicted 24 million Americans would purchase insurance on the exchanges by 2019. Actual enrollment in that year was only 10.6 million. After the Biden Administration expanded eligibility and increased subsidies, enrollment jumped to 13.8 million in 2022 and recently hit 24.2 million in 2025.
As the temporary subsidies are set to expire at the end of 2025, enrollment is likely to fall. There are several explanations for the missed enrollment targets from the original law. In the early years, technical glitches on the federal marketplace website likely discouraged take-up. Legislative changes have played a role too. The Tax Cuts and Jobs Act of 2017 (TCJA), for example, eliminated individual penalties for not having insurance.
But beyond these issues, prospective enrollees have discovered that the ACA’s insurance offerings do not meet their needs. ACA plans have never lived up to the promise that consumers would get access to low-cost plans. Premiums and deductibles have risen much more rapidly than its creators projected, and throwing more money at the program has not done much to improve options for enrollees.
A Small But Significant Glitch
Now, 15 years after its passage, fixing the ACA for deserving recipients should be the top priority.
Examples abound of cost-effective proposals to improve the programs for deserving families, and this year’s budget process is an opportunity to enact them. One simple way lawmakers could improve the quality of choices available is to fix a glitch in the ACA that precludes enrollees in most high-deductible health plans from opening health savings accounts. Significantly more Americans have HSAs today than when the ACA was passed. Still more might enroll if this glitch is addressed—in fact, we estimate that doing so would make up to eleven million current ACA enrollees eligible for HSAs at a cost of less than $2 billion over ten years.
The problem of eligibility stems from how the ACA calculates the growth in allowable maximum out-of-pocket (MOOP) cost-sharing limits. Those limits matter because HSA-eligible plans have an upper allowable limit (currently $8,050 in 2025 for single plans). When the ACA was drafted, the limits were initially aligned with HSA-eligible plans. However, the ACA tied annual increases in MOOPs to the growth in premiums, while allowable MOOPs for HSA-eligible plans remained indexed to slower-growing consumer prices. Over time, this seemingly minor technical difference has created a widening gap that now disqualifies most high-deductible ACA plans from being eligible for HSAs.
The numbers tell the story. In 2014, when the ACA marketplaces launched, MOOP limits were the same as for non-ACA high-deductible plans and 8 percent of enrollees chose HSA-eligible plans. In 2023, an estimated 68 percent of enrollees had plans with deductibles that met standard HDHP requirements but had MOOPs exceeding allowable limits. As a result, only 4 percent of enrollees chose HSA-eligible plans.
This isn’t because consumers don’t want these plans—they have proven popular among those with employer coverage. Instead, it’s because the law’s mechanical structure has gradually eliminated them as an option.
This matters because ACA enrollees often face higher out-of-pocket cost sharing requirements than those with employer coverage. The average silver plan deductible for those without cost-sharing reductions was $4,900 in 2023, compared to $1,900 for all private sector workers with employer coverage. Yet paradoxically, these ACA enrollees with higher deductibles are the ones locked out of using HSAs to help manage their health care expenses. The only thing stopping these plans from qualifying is their maximum out-of-pocket limits.
A Cost-Effective Fix
Congress could fix this with a straightforward legislative change: grant an exception for ACA marketplace plans that would otherwise qualify as HSA-eligible if not for their MOOP limits. This would maintain other HSA requirements in the employer-sponsored insurance market while eliminating an unintended barrier that serves no clear policy purpose.
The cost would be modest. If this change brought HSA-eligible plan enrollment back to 2014 levels, we estimate it would help an additional 945,000 Americans gain access to HSAs. Even assuming these enrollees contributed to their HSAs at the same rate as those with employer coverage—almost certainly an overestimate—the revenue impact in forgone tax collections would be just $1.7 billion over ten years. In comparison, CBO projects that extending the Biden Administration’s temporary ACA expansion would cost $335 billion.
The fundamental question is this: Why should Americans who purchase insurance on the individual market be denied access to the same tax-advantaged health savings tools available to those with employer coverage? There’s no policy rationale for this disparity. It exists solely because of a technical oversight in how different parts of our health care system measure inflation.
This is the rare health care proposal that should generate bipartisan support. It doesn’t fundamentally alter the ACA’s structure or bust the budget. And fortunately there are many more proposals that offer lawmakers cost-effective methods to deliver more health care options for all Americans.
Both sides of the aisle have reasons to be skeptical. Republicans are attempting to cut health care spending, while Democrats resist any health care changes that increase cost-sharing requirements. But Republicans could blunt criticisms that they’re cutting health coverage by pointing to an area that improves access and quality for low-income Americans, while Democrats could help remedy a feature of the ACA that denies an increasing number of families expanded health care options.
As health care costs continue to rise and many Americans struggle with medical expenses, we should be expanding access to proven tools like HSAs, not arbitrarily restricting them based on where someone gets their insurance. Our straightforward and bipartisan fix would help nearly a million Americans better manage their health care costs while making the ACA marketplace more attractive to families who currently lack affordable options.
Fifteen years after the law’s passage, there remain many ways in which it falls short of the goals its original supporters had. The reform that we propose won’t address all the law’s challenges but will be an important step toward making health care more affordable for families across the country.