At her Inverness salon, Tara McVicker was midway through an appointment when a client mentioned that the tax credits she used to pay for her health insurance would disappear by year’s end.
McVicker froze. The 51-year-old esthetician and cancer survivor said that coverage had saved her life.
Like many self-employed Floridians, McVicker buys her insurance through the Affordable Care Act. Since 2021, she’s benefited from a federal tax credit, known as the enhanced premium tax credit, that lowers the monthly cost. The enhanced credits are part of a pandemic-era expansion that put affordable insurance within reach for more middle-income families.
Two years into her enrollment, McVicker was diagnosed with breast cancer and underwent three major surgeries.
“It was a miracle,” she said. Her insurance plan allowed her to “make choices, have these surgeries, take the time off to care and to recover.”
McVicker’s plan caps her out-of-pocket costs at $2,350 a year. Without it, she estimates the years of surgeries, tests and treatments would have cost more than half a million dollars.
But the enhanced credits that made that possible will expire at the end of the year. When they do, McVicker, who still sees an oncologist for follow-ups, said she will no longer be able to afford her care.
The stakes are especially high in Florida, which leads the nation in Affordable Care Act enrollment. More than four million Florida residents, about one in five enrollees nationwide, rely on the Affordable Care Act for coverage, according to the Centers for Medicare and Medicaid Services.
About one in four of those Floridians are small business owners or self-employed workers like McVicker, according to projections from the Center on Budget and Policy Priorities. Florida leads the nation in that group, too.
When the Affordable Care Act passed, premium tax credits were only available to people earning up to 400% of the federal poverty level. This year, 400% of the federal poverty level is about $60,000 for a single earner.
But in 2021, Congress expanded the credits and removed the income cap, allowing more middle-income families to qualify. Under the expansion, people earning more than that qualify for a subsidy if the second-lowest cost plan in their area, known as the Silver plan, would cost them more than 8.5% of their household income.
Small businesses and self-employed workers disproportionately benefited from this expansion and saw record coverage gains over the last four years.
But when the enhanced credits expire at the end of this year, the Congressional Budget Office predicts that more than four million people will lose health insurance nationwide.
Florida’s business leaders are concerned that lawmakers haven’t renewed these credits.
“We have a complete and total lack of awareness,” said Mark Wilson, president and CEO of the Florida Chamber of Commerce, during a Jun. 25 local roundtable with state health and business leaders discussing the issue. He said most people, including policymakers, don’t know the risks.
“You’re looking at an expense or tax credit that’s already in place,” said Brent Burish, CEO of HCA Florida St. Petersburg and Pasadena Hospitals. “It’s extending what exists today, not starting something new.”
Burish said Congress has until September to act, because insurance rates are set in October and sign-ups open in November.
“This is not just a health care issue,” he said. “This is a business issue.”
Work that fits a life
Small business owners don’t enter the business to be rich, McVicker said. She did it to be a good parent.
She moved to Florida seven years ago, after leaving her job as a nurse in Ohio to care for her daughter, who had epilepsy, Tourette’s syndrome and anxiety. The seizures often came at night, making McVicker’s 12-hour hospital shifts unsustainable.
“I created this business so I could provide for her and me as a single mom, and have the flexibility to be there with her and guide her through what she needed and support her,” she said.
When her daughter’s seizures suddenly stopped, McVicker asked the then-13-year-old where she wanted to go.
“Florida, Mom, I want to go to the ocean,” she said.
The pair moved to Citrus County, where her daughter started high school, and McVicker found work at Tangles Hair Salon and Day Spa.
McVicker didn’t qualify for Medicaid, but she couldn’t afford private insurance either. Being uninsured, she said, felt like a dark cloud that never went away. “It’s always in the back of your mind,” she said, a voice pleading, “please don’t let anything bad happen.”
In 2021, the same year the tax credits were expanded, one of McVicker’s clients told her that she might be eligible. She applied right away.
Soon after, McVicker was diagnosed with breast cancer and began a series of major surgeries, a hysterectomy and a double mastectomy. Her coverage during that time proved critical to keeping her out-of-pocket costs affordable.
Tangles, where McVicker works, operates in an old-fashioned house. Each room is run by a different spa worker, each a sole proprietor. McVicker helped them all enroll for health insurance and access needed care. “In the spa industry, all these mothers, they’re trying to be available for their kids,” she said.
“We’re supposedly the American dream. To be in the position that I’m in and to have coverage,” she said, “It’s a dream come true.”
But when the enhanced credits expire, she’ll lose that.
Health care in the balance
That safety net doesn’t just protect business owners. It’s also what gives many Floridians the confidence to try to build something in the first place.
Katie Roders Turner, who helps Tampa Bay residents navigate health coverage as director of the Family Healthcare Foundation, said she works with clients who have turned to the enhanced tax credits to help them launch their businesses.
One of them, Vincent Cosentino, is a licensed mental health counselor in the Tampa Bay area. Cosentino, who started his practice in March after 17 years with a large agency, said the tax credits made that leap possible.
“It was not an easy decision to make the jump into self-employment and to utilize the healthcare marketplace,” he said. Before resigning, Cosentino met with healthcare navigators multiple times to understand his options.
“It’s a lot of work,” he said. “You have to pay attention, or else you could pay a literal price.”
Today, Cosentino uses the enhanced credits to purchase insurance for his family of three.
“There are probably a lot of people who are choosing not to pursue their dreams professionally, because of these limitations,” he said. “It’s unfortunate that something as essential as health care is a major deciding factor as to whether or not you’re going to start a business.”
Instead, Cosentino said, people should be thinking about marketing strategy, startup funding and loans. “Not whether or not you’ll be able to afford an ER visit for your family,” he said.
Cosentino plans to keep his family insured past the expiration of the enhanced credits, but he knows what it will cost.
“It’s going to eat into our household budget, and it’s going to reduce my ability to save for a new vehicle or spend my money on local businesses,” he said.
A system under pressure
The average premium in Florida for Affordable Care Act enrollees will nearly double when the enhanced credits expire, according to an estimate from KFF.
The exact impact varies based on factors like family size, income and age, according to the Center on Budget and Policy Priorities.
In Florida, a 60-year-old couple earning $82,000 would see their annual premiums rise by almost $20,000. For a family of four making $126,000, premiums would rise by more than $9,000 each year.
With the Trump administration’s budget bill that passed this year, an estimated 16 million Americans will lose health insurance across Affordable Care Act and Medicaid plans, according to the same Congressional Budget Office report. About 15% of those projected to lose coverage live in Florida, the most of any state, according to a Center on Budget and Policy Priorities analysis.
That’s 2.4 million Floridians who will lose health insurance over the next 10 years due to policy changes, including the expiring credits.
“I don’t know if people fully comprehend that the marketplace implications in the state of Florida are huge,” Turner said.
For now, some Florida families using the enhanced tax credits are in limbo.
McVicker’s daughter, now in college, is still on her mother’s plan.
Asked what she would do when the enhanced credits expire, McVicker laughed.
“Well, I’ve been saying I need to go on a diet for a while,” she said. “It’s healthcare or food.”
She held the smile, but her voice softened.
“I don’t know. I think it would be over $1,000 a month. I don’t have $1,000 a month.”
Between running her business and sending her daughter grocery money, McVicker said that, by year’s end, they won’t have health insurance anymore.
“We can’t get sick. We can’t afford to,” she said. “It’s the biggest fear for me and my daughter.”
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