Trump announces $500 Obamacare refunds for nearly 1 million people — here's who qualifies

President Donald Trump announced Thursday that the federal government will issue $500 Obamacare refunds to nearly 1 million people starting in October.

The refunds will be available to enrollees in Obamacare — the informal name for the Affordable Care Act — from 30 states that use the federally run exchange to operate their healthcare marketplace, according to a White House fact sheet published Thursday.

A White House official said recipients are largely those from middle-income households who don't currently receive federal financial assistance for insurance premiums.

The refund payments — which would total about $500 million — come just weeks before the midterm elections, in which Democrats are favored to win back at least one chamber of Congress from Republicans.

In a speech Wednesday night, Trump said the government would send a separate $5,000 election "dividend" to every adult U.S. citizen if Republicans are victorious in the midterm contest.

The financial promises come amid a broader affordability crisis for Americans and as the Iran war continues to push up costs for everyday necessities like gasoline, and as millions of households saw their health insurance premiums spike after ACA premium subsidies lapsed at the end of 2025.

Health policy experts said the refunds offer relatively little financial assistance to ACA enrollees hit with soaring insurance premiums this year after those enhanced federal subsidies lapsed.

"As band aids go, this is not very effective," Jonathan Oberlander, a professor of health policy and political science at the University of North Carolina at Chapel Hill, wrote in an email.

He said the policy is likely a form of "damage control" for the White House to distract from higher healthcare costs.

"This announcement is less about health policy and much more about the 2026 Congressional elections," he wrote. "It's part of a broader effort by President Trump to buy continued Republican control of the House and Senate via promises of direct government payments to voters."

The 30 states eligible for the Obamacare refunds 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.

These states use the federal ACA exchange, while the others use their own state-run marketplace.

Democratic-governed states are more likely to run their own ACA marketplace than those governed by the GOP, Oberlander said.

The White House said in the announcement that the $500 refunds would come from a surplus of "user fees," which it described as excessive charges from the Biden administration passed on to consumers through higher health insurance premiums.

"Today's actions directly refund the Americans most exposed to the higher costs imposed by the Biden Administration's gross mismanagement of Obamacare," the White House fact sheet said.

Under Obamacare, healthcare exchanges can collect user fees from insurance companies to help fund ACA marketplace operations.

User fees have existed since 2014. They are revised annually by the Centers for Medicare and Medicaid Services and paid by health insurers who participate in the ACA marketplace.

The fees went up and down during the Biden administration in different years — and were at times lower during the Biden era than during the first Trump administration, Oberlander said.

A temporary enhancement to ACA premium tax credits expired at the end of 2025, after the Republican majority in Congress defeated Democrats' efforts to extend it.

As a result, households over 400% of the federal poverty line — roughly $63,000 for an individual and $129,000 for a family of four — lost all access to ACA subsidies, which help reduce monthly insurance premiums. In other words, they must pay the full, unsubsidized premium.

A White House official said this group would "primarily" benefit from the $500 refund checks. However, some people between 100% and 400% of the poverty line are also eligible, the official said.

The latter group might include young people in their 20s who live in a low-cost area, for example, who may not qualify for premium assistance, said Larry Levitt, executive vice president for health policy at KFF, a health policy research group.

The expiration of enhanced ACA subsidies, in place since 2021, caused insurance costs to rise for most ACA enrollees and led millions to drop coverage or downgrade to cheaper, skimpier plans.

As of February, ACA marketplace enrollment had declined by about 3 million people, or 13%, from enrollment figures a year earlier, the Department of Health and Human Services said in June.

"There's no doubt middle-income ACA enrollees who are no longer getting premium subsidies would welcome $500 checks, but this would be a drop in the bucket for many of them compared to the thousands of dollars more they're paying with the expiration of the enhanced tax credits this year," Levitt wrote in an email.