President Donald Trump’s administration says nearly 1 million Americans will receive $500 health insurance refunds beginning in October, with eligibility focused on Affordable Care Act customers who paid their premiums without federal assistance.
The White House announced the “Working Families Obamacare Refunds” initiative Thursday, targeting qualifying enrollees in 30 states that use the federal marketplace.
“The relief begins with refunding everyone who was overcharged, and the rebates are going out in just a few weeks,” Trump said in a recorded announcement.
Approximately $500 million would be distributed, Conservative Brief reported. The administration says the payments will return excess marketplace fees that insurers passed along to customers through higher premiums.
Eligibility primarily covers people who bought insurance through HealthCare.gov and received no federal premium assistance. That includes higher-income households ineligible for subsidies and some lower- and middle-income consumers who did not receive available assistance.
Consumers whose premium costs were already limited by federal subsidies are not expected to receive checks. States operating independent exchanges, including California and New York, are excluded.
The eligible states are Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Hawaii, Indiana, Iowa, Kansas, Louisiana, Michigan, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia, Wisconsin and Wyoming.
The payments center on marketplace user fees, which insurers pay as a percentage of premiums to support HealthCare.gov and related operations. Insurers generally factor those expenses into what policyholders pay.
For 2026, the Centers for Medicare & Medicaid Services set the federal marketplace fee at 2.5% of monthly premiums. State exchanges using the federal platform were charged 2%.
The White House says the Biden administration collected more than the exchanges needed, accumulating a surplus. It argues unsubsidized customers bore the full cost of the fees embedded in their premiums.
Health policy specialists have challenged that explanation, including the suggestion that each recipient was individually overcharged $500.
“The Biden administration actually lowered the A.C.A. marketplace user fees,” Larry Levitt, KFF’s executive vice president for health policy, told The New York Times, according to Conservative Brief.
Cynthia Cox, who directs KFF’s ACA research, said some surplus funds may date to collections before Biden took office. Money also accumulated as spending on enrollment assistance, advertising and other marketplace activities was reduced or left unused.
Cox told Reuters that federal subsidies limit eligible consumers’ monthly premiums to a share of household income, so the government generally absorbs the cost of higher insurance prices.
The government plans a flat payment and has not published an individual accounting showing each recipient overpaid exactly $500.
The announcement follows Trump’s separate $5,000 dividend proposal, tied to Republicans retaining Congress. Fox News host Laura Ingraham questioned why those proposed payments would wait until after the elections.
In comments to Reuters, a White House official said the administration had already identified eligible recipients.
The administration has not announced a separate application requirement for the Obamacare refunds. Checks are scheduled to begin going out before the Nov. 3 midterm elections.
