Enhanced Affordable Care Act subsidies introduced in 2021 have now expired, leaving more than 20 million Americans facing steep insurance premium spikes going into 2026. More than 1.6 million Californians and 120,000 San Diegans had received the subsidies.
That loss is one of many looming hits to the federal social safety net.
Medicaid, the Supplemental Nutrition Assistance Program and several programs aimed at reducing homelessness are all set to have funding cuts or stricter eligibility requirements. Here are the changes inewsource is watching.
Health care impacts
With health-care costs rising nationally, two of the biggest federal programs that help Americans afford health care will be less accessible. The Affordable Care Act subsidies expired on New Year’s Eve after Congress failed to pass an alternative.
Thursday, the House of Representatives voted 230-196 to resurrect the subsidies for three years, but the prospects for the extension in the Senate are unclear.
Unless Congress changes course, those making more than 400% of the federal poverty level, which means $62,600 for an individual and $128,600 for a family of four, will lose their subsidies and see the biggest relative insurance premium increases. Those below that threshold will also see increased premiums. KFF, a nonprofit that researches healthcare policy, estimated premiums will double on average nationwide.
The new year will also bring eligibility changes to Medi-Cal, starting in October when immigrants in the country legally lose access to California’s version of Medicaid. Only green card holders and those who immigrated legally from specific countries like Cuba, Haiti, the Federated States of Micronesia, the Republic of the Marshall Islands and the Republic of Palau will be eligible.
In San Diego County, that’s about 75,000 people.
Others will be affected in 2027 when new work eligibility requirements kick in for those between the ages of 54 and 65 and for those with children between 14 and 18. Throughout the year inewsource will be working to keep readers apprised of all the changes.
A budget shortfall
People who haven’t met the new work requirements for the food assistance program CalFresh, called SNAP nationally, will lose benefits starting in February.
SNAP now has the same new eligibility requirements as Medicaid, but they took effect in November, when recipients had three months to find work.
San Diego County has estimated that the new Medicaid and SNAP requirements could cost it over $300 million to pay for 1,000 new staff to administer the program and for the benefits themselves. The county estimated that 400,000 people in the region subjected to the new work requirements could lose benefits if they don’t find employment.
An $18 million commitment from philanthropists will plug part of the budget hole, but the county is far short of bridging the entire gap. As county supervisors grapple with this shortfall, inewsource will scrutinize the plans that emerge all year long.
Housing cuts
Another major change on the horizon involves the Department of Housing and Urban Development’s decision to cut the amount of funds for permanent housing by two-thirds starting in 2026. That’s a more than $2 billion cut nationally.
Permanent housing is a type of program within HUD’s continuum of care that comes in two forms: rapid rehousing, which helps to transition people into long-term housing outside the program, and permanent supportive housing, meant to be an indefinite lease.
In California, 90% of HUD continuum of care funds went to permanent housing projects totaling more than $683 million last year. The cuts put tens of millions at risk in San Diego County.
Last year, San Diego homeless providers told inewsource that they would prioritize keeping people in their homes, cutting supportive services and winding down the successful rapid rehousing program if the federal government went through with the cuts.
As final decisions are made, inewsource will be watching to see what happens to programs and housing units in San Diego and how local providers adapt to the changes at HUD.
A state of crisis
At the same time, organizations that traditionally supplement the federal safety net are also feeling the squeeze. Nonprofit organizations in San Diego declared an emergency in June after six months of grant funding cuts that threatened a wide range of services.
Claire Groebner, associate director at Olivewood Gardens, a community gardening nonprofit in National City, said then that federal rollbacks had “disrupted vital services and programs, the living conditions of our community.” Groebner said it had led to a “state of crisis.”
Many nonprofit organizations provide food assistance, homelessness services, legal aid and health care — the same services that are expected to see increased demand as federal benefits shrink. Nonprofit leaders say they are already drawing down reserves, delaying hiring and cutting programs, even as more residents seek help paying for rent, food and medical care.
As 2026 progresses, inewsource will be watching to see how nonprofits continue to adjust.
If you are affected by new changes to federal policy or have information on how it is impacting San Diego we want to hear from you! Reach out to me at jakekincaid@inewsource.org.
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