ACA Tax Credit Negotiations Have Stalled. Senators Can’t Even Agree on a Reason Why.

Negotiators on both sides of the aisle say that the prospects to renew Affordable Care Act tax credits are increasingly bleak. But Democrats and Republicans involved in the health care talks cite different reasons for why things fell apart.

A bipartisan Senate group, led by Sens. Bernie Moreno and Susan Collins, has been working to finalize legislative text to revive the ACA subsidies, which expired at the end of 2025. The group began its effort after debate over the subsidies led to the longest government shutdown in history.

Democrats in the working group now say proposed language around restricting federal funding for abortion services is responsible for tanking negotiations.

“The issue is Hyde, 100%,” Sen. Angus King, an independent who caucuses with Democrats and has been involved in the talks, told reporters Thursday, referring to the long-standing measure included in health care bills that prohibits federal funding for abortion care. “The ACA already has Hyde language in it, and it’s really, it’s a shame that this anti-abortion thing has to screw up the ability of millions of Americans to have reasonable-priced health care.”

The debate about the issue is a particular point of contention for both parties. Democrats have said the Hyde Amendment does not need to be included in any extension of the subsidies while Republicans wanted to see the issue particularly addressed.

Negotiators thought they had come to a compromise on Hyde by including language that would require an audit of states’ adherence to the amendment. But Sen. Tim Kaine told reporters Thursday that Democrats in the group were taken aback by new abortion-related language applying to health savings accounts included in the legislative text offered by Moreno.

“It fell apart for one reason: the Hyde Amendment,” Kaine said. “We talked to our colleagues, and we said, ‘the Hyde Amendment was included in the ACA, and we’re willing to state that nothing we’re doing here contravenes that.’ They wanted more, and that was going to be a nonstarter.”

Kaine added that Democrats felt the provision had been added surreptitiously after the bipartisan group had agreed not to rewrite the Hyde amendment in this targeted health care bill.

“They added something new. We said, ‘Take it out.’ And that is why the negotiations are not going anywhere,” Kaine said.

Moreno maintains that the abortion language wasn’t what caused the talks to collapse; it was “other elements.” He argued what Republicans included in the proposal was within the bounds of the agreement.

“HSA language has to have Hyde language in it, because HSAs are not protected by Hyde. What we’re asking for is totally reasonable, common sense.”

Moreno blamed Democratic leadership for opposing some of the reforms included in the text, including the phasing out of the subsidies over three years and a $5 minimum payment. He pointed the finger at Senate Minority Leader Chuck Schumer as the one directing Democrats to walk.

“Ultimately, underlying all of it was, they could have proposed a package of extension of the enhanced subsidies with reforms,” Moreno said. “The reason they didn’t is because Schumer prefers the political issue. If it was up to the colleagues I was negotiating with, it would have been solved. But Schumer shut it down.”

King, who said he has attended every meeting on the health care subsidies, said Democratic leadership has not made any sort of statement on Moreno’s proposal.

“Schumer had nothing to do with it. Zero,” King said. “I’ve been involved at every meeting. This is all about Hyde showing up at the very last minute, and that’s what the problem is.”

Sen. Peter Welch, another Democrat involved in the talks, echoed King’s analysis.

“The dilemma is the abortion issue is now part of the discussion, and that’ll doom it,” Welch said.

But, King said that the working group has yet to fully hash out Democrats’ issues with Hyde. King added he and Sen. Jeanne Shaheen, another negotiator, struggled to schedule a meeting with Moreno this week.

King said he is open to continuing to negotiate, but he projected little chance of success. Other senators said the same. Collins told reporters Wednesday that a path forward was “possible” but seemed “certainly difficult.” Senate Democratic Whip Dick Durbin told reporters that negotiations were facing “some big issues,” but added that there could still be a “very limited path” forward.

Moreno said Thursday he was disappointed that after more than a month of negotiations there wasn’t anything to show for it. But he added that it was important there was a core group of lawmakers trying to find common ground on a thorny issue.

“I would say disappointing but not surprising, because obviously there’s a lot of politics in politics,” Moreno said. “Shouldn’t we be here trying to figure out how to solve problems, rather than trying to figure out how to score political points?”