With federal government funding set to expire January 30 and health insurance subsidies unresolved, lawmakers return to Washington under growing pressure. 

It may be a New Year, but it’s not a fresh start for Congress. 

When lawmakers return to town, they will face the same problems they didn’t address before the holiday break: a looming government shutdown and a growing health insurance squeeze. The difference now is timing. With deadlines fast approaching and a light January work schedule, Congress has even less room for error. 

As things stand, lawmakers are far from a deal on either front. There’s no bipartisan agreement on federal government funding beyond January, and no enacted plan to prevent millions of Americans from facing sharply higher health insurance costs next year. The clock is ticking on both. 

Shutdown Showdown, Again 

Just weeks after the longest government shutdown in history, Washington is once again barreling toward another one. Unless Congress acts, parts of the federal government will shut down on January 30th. 

The agreement that ended the last shutdown was a short-term fix. Known as a continuing resolution, or CR, it kept most federal agencies open but only for a couple of months. Only three of the twelve areas of government spending – Agriculture, the Legislative Branch, and Military Construction and Veterans Affairs – received full funding for the entire year. Everything else is set to expire at the end of January. 

Since that CR was signed on November 12, Congress has made no visible progress on the remaining full-year spending bills. If lawmakers fail to pass those bills, or another stopgap CR, a partial shutdown will begin. Here’s what that would look like: 

The biggest relief this time around is that SNAP, the program that provides food aid to 42 million Americans, is now fully funded. In the last shutdown, November SNAP benefits were reduced or delayed in several states after a federal emergency fund was depleted.  

Luckily, the shutdown ended in early November and SNAP benefits began flowing soon after. It’s easy to imagine how bad things could’ve gotten if food aid were disrupted for a month or more. 

SNAP wouldn’t be affected by a January 30th shutdown, but other crucial areas of the government could be. Military troops would serve without pay, staff at the National Nuclear Security Administration – the agency that makes sure our nuclear weapons are safe and secure – would get furloughed, National Parks would close, federal employees and small-business contractors would either get sent home or work without pay, and the economy would take another hit.   

House and Senate Republican appropriators reached an internal agreement on the rest of the funding bills, but there’s no sign that Democrats were part of those talks. That matters because any spending bill must clear the Senate’s 60-vote filibuster threshold, which requires at least some Democratic support. And although President Trump has once more called on Senate Republicans to get rid of the filibuster so Republicans can pass all legislation on a party line basis, Senate Republicans – many of whom are strong No Labels allies – are continuing to resist the president’s pressure. 

Negotiators will have to reach an agreement quickly. Congress is taking a lot of vacation time in January: the House is only in session for 12 days before the shutdown deadline strikes, and the Senate is only working 15 days.  

Where ACA Subsidies Stand in 2026 

Congress also left town without a fix for the enhanced Affordable Care Act (ACA) premium tax credits, which were passed during Covid and run out at the end of 2025. If nothing changes, many of the 22 million Americans who receive the credits will see their health insurance costs skyrocket in 2026. 

But the battle doesn’t end when the subsidies expire.  

In the House, a bipartisan group collected enough signatures on a “discharge petition” to force a vote on a bill to restore the enhanced subsidies for another three years.  

Many of those same members are also backing the CommonGround for Affordable Healthcare Act led by Reps. Josh Gottheimer and Jen Kiggans. This bipartisan bill would extend the subsidies for a shorter period while also cracking down on fraud and abuse in the program. It has more Republican support than the three-year extension, giving it a better chance of becoming law. 

Both approaches would restore the subsidies retroactively, meaning eligible patients would receive credits dating back to January 1, 2026, if either bill becomes law. The CommonGround plan would also extend the ACA open enrollment period through March 2026, allowing people to choose or change health plans with full knowledge of the available tax credits. 

Over in the Senate, leaders from both parties including Sens. Susan Collins, Bill Cassidy, and Jeanne Shaheen are having “very constructive” conversations behind closed doors about broader reforms that could keep health care costs down.  

Since the expiring ACA subsidies were a major flashpoint during the last government shutdown, January 30th is shaping up as a key deadline for both health care policy and government funding. As the New Year gets underway, Congress has limited time to prove it can meet the moment.