Maine Business Owner Considers Dropping Health Insurance Amid Rising Costs

In a notable case highlighting the challenges small business owners face, Chloe Chalakani, who operates a handmade pasta business in Thomaston, Maine, is contemplating dropping her health insurance due to escalating costs and the expiration of federal subsidies. This decision reflects broader concerns about the stability of the health insurance market, particularly impacting young and healthy individuals.

Chalakani, who runs her culinary business with a partner, is currently confronting a premium of $460 a month for a high-deductible health insurance plan. As her busy tourist season winds down, she is reviewing her administrative tasks, including health insurance enrollment. With the end of enhanced tax credits in December 2023, she anticipates an increase in rates and has expressed her intention to forgo coverage in the upcoming year, stating, “I don’t plan to get insurance next year. I’m just not going to do it — I’ll pay out of pocket.”

The potential departure of younger, healthier individuals from the Affordable Care Act (ACA) markets is alarming health policy experts. These individuals typically contribute more to the insurance system than they utilize in healthcare services. Cox, a health policy analyst, notes the importance of maintaining a balanced pool of insured individuals. “You need people to be paying into the insurance system when they’re healthy so that they can take out when they’re sick,” he explained.

Many young adults are likely to opt out of insurance, which could lead to a rise in premiums for remaining policyholders. Older and less healthy individuals are generally more motivated to retain their coverage, as they are more likely to require medical care. This dynamic can create an unsustainable situation where only those with extensive healthcare needs remain insured, driving costs even higher.

Chalakani’s situation is echoed by many others across the country. She is among the 24 million Americans who acquire insurance through the ACA. While acknowledging the risks of going uninsured, she remarked, “Should a catastrophe happen, I’ll probably say, ‘Wow, I should have had insurance.’ But at this point, I don’t have the financial ability to plan for that.”

The impending expiration of federal subsidies is expected to lead to “sticker shock” for many consumers when they log in to compare plans for 2026. Without swift legislative action by Congress to extend these subsidies, many individuals could find themselves unable to afford necessary coverage. The consequences of increasing uninsured rates extend beyond individual health risks; hospitals and healthcare systems may face significant financial strain, potentially resulting in reduced services or even closures.

Chalakani remains open to reconsidering her decision if lawmakers manage to extend enhanced subsidies, which would help maintain her current premium levels. The ongoing debate surrounding healthcare affordability and accessibility underscores the critical need for solutions that ensure sustainable coverage for all Americans, particularly those operating small businesses.