Church and denominational staffs are scrambling to find employee health insurance alternatives in the event Affordable Care Act subsidies expire at the end of the year.
Their dilemma results from Congress’ failure to extend the expiring tax credits as part of the deal to reopen the federal government Nov. 11. To end the stalemate, Senate Republicans agreed to schedule a separate vote on the subsidies by mid-December, but it’s uncertain if that effort will succeed.
More than 24 million people are enrolled in the ACA Marketplace where tax credits saved enrollees an average of $705 in 2024, said KFF, an independent health policy research group. “Without the enhanced premium tax credits, annual premium payments in 2024 would have averaged $1,593 (over 75% higher than the actual $888).”
Rob Fox
Among the most affected are small congregations that usually can’t afford group plans and instead provide salary stipends to staff members for use in the ACA Marketplace, said Rob Fox, president of the Church Benefits Board of the Cooperative Baptist Fellowship.
“All denominations are facing similar challenges related to health insurance. Beyond the potential loss of ACA subsidies, some denominational small-employer health plans are experiencing premium increases of 30% or more.”
But the potential increases could be much higher for some ministers and their families utilizing ACA for health care insurance.
Adam Gray
“This year, even with the subsidies, it costs us $1,200 a month for me and my wife, and that’s before co-pays,” said Adam Gray, pastor of Riverside Church, a CBF and Alliance of Baptists congregation in Jacksonville, Fla.
“Next year, with the subsidies expiring, our insurer informed us it will cost $2,600 (per month) to stay with the same insurance,” he said. “So now we are faced with the question: Do we spend more than $30,000 a year on health insurance before co-pays, or do we scrape by with some much-worse insurance plan?”
Joe LaGuardia
Joe LaGuardia, senior pastor at First Baptist Church in Vero Beach, Fla., signed up for ACA after the church dropped its group insurance plan.
“ACA was very affordable for our family until the shutdown,” he said. “If I sign up today, without the subsidy, it will cost three times my current policy rate,” said LaGuardia, whose church partners with CBF and the Southern Baptist Convention.
Congregations and denominational organizations are facing the same dilemma, said Larry Hovis, executive coordinator of CBF North Carolina.
“It’s a reality a lot of our churches are facing because a lot of our churches were using it (ACA),” said Hovis, adding that he and other employees in his organization are in the same boat.
“Before ACA we had a group plan for our staff, but it was becoming cost prohibitive. When ACA came out, we gave everyone a raise to go into the Marketplace to buy their own health insurance. We got out of the being the middleman and it worked well for a while.”
For the time being, many CBF congregations in North Carolina are faced with returning to cost-prohibitive group plans or paying employees even more to cover the lost subsidies.
“There is no easy answer and there is no good answer to this,” Hovis said.
Larry Hovis
To address the challenge to its partner churches, CBF is implementing “contextualized health insurance solutions” and reimbursement arrangements for individuals and small employers, Fox explained. “The loss of ACA subsidies will likely create financial challenges for many ministers and church staff. However, this change also presents an opportunity for churches and ministers to take a more intentional approach to compensation and benefits.”
The benefits board has experienced a spike in inquiries from congregations and individuals, Fox added. “Health insurance remains one of the primary benefit challenges facing congregations and their staff across denominations. There’s no silver bullet, but we encourage churches to work with trusted, licensed professionals.”
The consequences are spiritual as well as economic and churches are going to have to find pastoral approaches to help members deal with the situation, Gray said. “It’s becoming existential. How are people going to be able to live when they can’t afford the health care they need, and how we respond to that as Christians individually and corporately as churches?”
Riverside Church is projecting 20% attendance growth but flat giving for 2026 as more dollars go to health insurance instead of tithing, he said.
“I don’t want people giving to the church when they can’t afford their medication, keep the lights on and have trouble making rent. But it raises the question of how do we function in this world that has been so corrupted by this exploitive scarcity mentality? How do we live, how do we take care of each other?”