Lawmakers from both parties are preparing for the likelihood of another government shutdown next year. This follows the blocking of a proposal by Republicans to extend crucial health insurance subsidies. This blockade was the catalyst for the recent 43-day shutdown that significantly affected the fall legislative schedule.

Senate Democrats, particularly those with liberal views, are expressing frustration over the Republican decision to halt the proposal that aimed to stretch the expiring subsidies until 2028. These subsidies are critical as they are set to expire in January.

Last month, a coalition of eight centrist Democrats voted in favor of reopening the government, hoping this would encourage Republicans to negotiate a bipartisan solution. The goal was to prevent substantial increases in health insurance premiums for those purchasing plans through the ObamaCare marketplace.

However, efforts to reach a bipartisan agreement to extend the subsidies fell apart, paving the way for a potential significant rise in health care premiums in the coming year.

This situation has invigorated liberal Democrats who now advocate for using the looming January 30 government funding deadline as a bargaining tool. They aim to compel Republicans to agree to substantial federal health care spending compromises, similar to strategies employed during the September and October negotiations.

After Republicans defeated a Democratic bill to extend the subsidies for three years, Sen. Elizabeth Warren (D-Mass.) said the next government funding deadline is a leverage point.

“The fight is not over,” she said.

Sen. Bernie Sanders (I-Vt.), another prominent progressive voice in the Senate Democratic Caucus, called the Republican vote against extending the enhanced subsidies “an outrage.”

Asked if Democrats should threaten another shutdown to pressure Republicans to agree to extend the subsidies, Sanders said he didn’t want to speculate but declared the expiration of tax credits “is going to result in a lot of pain for a lot of people.”

Congress’s failure to extend the enhanced subsidies means that an estimated 4.8 million Americans will lose health care coverage in 2026, and more than 20 million Americans will see their health care costs rise dramatically.

Insurance companies are projected to charge people who buy their insurance through the Affordable Care Act marketplace 26 percent more if the enhanced subsidies expire in January.

A third member of the Senate Democratic Caucus who requested anonymity to speak candidly about the political situation said another government shutdown is possible if Republicans don’t agree to pass a package of regular spending bills known as the minibus by the end of next month.

The Democratic senators said that Democrats would have far less leverage if the Senate appropriations package, which covers the departments of Defense, Health and Human Services, Labor, Commerce, Justice and Interior, among other agencies, passes next month.

If President Trump signs that package into law, it would result in approximately 85 percent of the federal government being funded through September of 2026, leaving Democrats much less leverage to threaten a shutdown to get Republicans to agree to an extension of the enhanced Affordable Care Act tax credits — the issue that triggered the shutdown in October.

“If they [bring] the group of five bills to the floor and we get them coordinated with … the House, then essentially you have appropriations bills for 85, 95 percent of the government by the end of January, and shutdown doesn’t mean much,” said the lawmaker.

However, if those bills stall, then the likelihood of a shutdown skyrockets, the lawmaker said.

“Then that raises this interesting question. Do we shut down over health care or Venezuela or Epstein files not being delivered,” the senator warned.

The Democratic lawmaker said if Trump initiates a large-scale bombing campaign against Venezuela, the issue will become a flash point on Capitol Hill that could spur Democrats to oppose any government funding bill to get the White House to back down.            

Senate Majority Leader John Thune (R-S.D.) is pushing hard to get the package of five appropriations bills passed next month to take away leverage from Senate Democratic progressives who want to threaten another government shutdown to pressure Republicans to back an extension of the expiring health care subsidies.

Sen. John Cornyn (R-Texas) warned that if most of the annual appropriations bills are left in limbo by the end of January, Democrats could replay the strategy that led to the longest shutdown in American history earlier this year.

“They may be tempted to do it, as disastrous as the last one was,” he said.

Cornyn predicted that Senate Democratic Leader Chuck Schumer (N.Y.) would come under heavy pressure from liberals — both in the Senate and back home in New York — to force another government shutdown.

“Schumer’s not in any different political position than he was back then,” he said, referring to Schumer’s opposition in September and October to a “clean,” seven-week continuing resolution to keep the government operating.

“He’s afraid of the Democratic base,” Cornyn added, warning that Republicans would be “taking a risk” of another shutdown if they don’t hammer out a bipartisan deal to pass the regular appropriations bills in January.

Senate Appropriations Committee Chair Susan Collins (R-Maine) said she’s worried about another shutdown if the five-bill spending package fails to move soon after New Year’s Day.

“My worry is if we don’t pass this five-bill package, we will end up in a shutdown,” she said.

The five-bill appropriations minibus is being delayed in the Senate by conservative Sens. Mike Lee (R-Utah), Ron Johnson (R-Wis.) and Rick Scott (R-Fla.), who are objecting to the number of earmarks in the appropriations bill, authorizing language that they said should be attached to spending legislation and the sheer size of the package.

Another major obstacle is that House GOP leaders haven’t yet agreed to the top-line spending numbers for 2026. Collins told The Hill that she’s waiting to hammer out the top-line spending levels for several bills with the House.

“There aren’t top lines on several bills. There are [top-line spending agreements] on some but not on Labor, H, not on DOD, not on CJS,” she said, referring to the bills funding the departments of Labor, Health and Human Services, Defense, Commerce and State.

Appropriators are making some progress on resolving their disagreements with conservatives, which have stalled progress on the spending package for weeks.

Lee said he is negotiating over the authorizing language that falls within his jurisdiction as chair of the Senate Energy and Natural Resources Committee. The language was added without his consent to the Interior appropriations bill.

“I agreed to accept some of it, we’re negotiating the final details about exactly what’s going to be included,” he said of the language in the Interior bill that spurred him to put a hold on the spending package.

Lee said he’s gotten “commitments” on scheduling votes to strip some of the earmarks out of the package.