Trump To Give $500 Refunds To Nearly 1 Million Obamacare Customers

The Trump administration will give $500 to nearly 1 million Americans who lost income-based subsidies that helped reduce health insurance costs, according to a Thursday White House announcement.

The refunds will go out next month. The announcement comes less than two months before the November midterm elections, where skyrocketing health costs have become a key campaign issue, and after the White House opposed efforts to extend Biden-era enhanced subsidies last year.

“Today’s actions directly refund the Americans most exposed to the higher costs imposed by the Biden Administration’s gross mismanagement of Obamacare,” according to a White House fact sheet.

The refunds, first reported by Axios on Wednesday, will go to people who earn too much to qualify for an income-based subsidy to lower their health insurance costs. Those individuals received subsidies for a few years under legislation Democrats first enacted in 2021, but they expired at the end of last year. Trump and Republicans in Congress resisted Democratic pressure to extend them, saying they were meant as a temporary pandemic-era boost.

Individuals whose income is more than 400 percent of the federal poverty level, around $60,000, are now ineligible for a subsidy. They faced the brunt of higher premiums for 2026, and in some cases have to pay thousands of dollars more for health care.

The refunds apply to a small number of people on Obamacare’s exchanges. The Trump administration estimated in June that around 19 million people got coverage on the exchanges this year. The vast majority of them get some form of subsidy relief but face higher premiums for this year after Republicans declined to extend the 2021 law. Through this refund, nearly 1 million of the 19 million people will get some relief.

Recipients will be from 30 states that do not operate their own health insurance exchange. These states rely on the federally run HealthCare.gov for residents to buy insurance.

Some of the state-based insurance exchanges, such as those in Maryland and New Mexico, used state funding to fill the loss from the subsidies that expired.

The White House fact sheet said the money is coming from the Biden administration overcharging Americans via exchange “user fees” that are “passed on to consumers in the form of higher premiums, funding the operations of the federal Obamacare exchange far in excess of what was needed to run the exchange.”

The administration has a surplus of funds that are now being used to fund the refunds, the White House added.

The federal government and states charge insurers user fees primarily to fund operations.

The White House did not return a request for comment on how much the surplus is or how the Biden administration misused the user fees.

One health insurance expert said this application of user fees is “unprecedented” and the surplus is not solely due to mismanagement under former President Joe Biden.

“Part of the reason a surplus of user fees has built up is that both Trump administrations dramatically cut back on ACA outreach,” said Larry Levitt, executive vice president for health policy at the nonpartisan health research organization KFF, in an emailed statement referencing the Affordable Care Act, the legislation that launched Obamacare.

Conservatives have charged that the federally run exchanges have become a hotbed for fraud and that the Biden administration removed guardrails surrounding eligibility, sparking a rise in enrollees ineligible to get coverage. Fraud was one of the key concerns that torpedoed efforts late last year to extend the enhanced ACA subsidies.