ACA Enrollment Plunges by 5 Million as Subsidies Expire

A new analysis from KFF, the nonpartisan health research organization, projects that enrollment in Affordable Care Act (ACA) marketplace plans could drop by approximately 5 million people in 2026 — from 22.3 million in 2025 to as low as 16.5 million. The steep decline follows the expiration of enhanced premium tax credits at the end of 2025, which Congress failed to extend despite bipartisan negotiations. The result: millions of Americans face dramatically higher costs, forcing many to drop coverage, shift to high-deductible plans, or become uninsured.

Why It Matters

The enhanced premium tax credits, first established by the American Rescue Plan in 2021 and extended through 2025 by the Inflation Reduction Act, had driven ACA enrollment to record highs by capping premium payments at 8.5% of income for all income levels. When those subsidies expired on December 31, 2025, the affordability calculus shifted dramatically for millions of Americans.

According to KFF, average monthly premium payments (net of tax credits) rose 58%, from $113 to $178 per month. For those who kept the same plan, KFF previously estimated a 114% increase. At the same time, average ACA Marketplace deductibles increased by 37% — or $1,027 per person — to a record high of $3,786 in 2026, the steepest increase ever in this market.

Who Is Leaving the Marketplaces?

The enrollment decline is not evenly distributed. Consumers with incomes above 400% of the federal poverty level (FPL) — the so-called “subsidy cliff” — made up just 7% of 2025 enrollment but nearly half (48%) of the decline in plan selections. Young adults ages 18–34 accounted for 46% of the total decline, as healthier, younger individuals disproportionately opted out.

Internal CMS documents obtained by NOTUS reveal that roughly 21% of enrollees in the 30 states using the federal HealthCare.gov marketplace failed to pay their first month’s premium — nearly double the 12% rate from the same period last year. CMS Administrator Mehmet Oz has sought to attribute a majority of the enrollment declines to rooting out fraud rather than non-payment, but internal CMS sources told NOTUS it is “unlikely fraud is behind most of the cancellations.”

“Costs went up significantly and a lot of people dropped their plans,” said Cynthia Cox, director of KFF’s Program on the ACA and co-author of the analysis. “Those who stayed [in the marketplaces] are paying more, either in the form of higher premiums or higher deductibles or both.”

A Shift to Cheaper, Riskier Plans

To offset rising premium costs, many enrollees have switched to bronze plans, which have lower monthly premiums but much higher deductibles. The share of people selecting bronze plans jumped from 30% (7.3 million people) in 2025 to 40% (9.2 million people) in 2026. Meanwhile, silver plan selections fell from 57% to 43% — a record low and the first time fewer than half of ACA consumers have selected a silver plan.

This shift has profound implications for healthcare access. “If you’re uninsured, you’re going to face higher costs if you need to go to the doctor,” Cox told NPR. “You’re also at risk of financial catastrophe if you face a major accident or serious diagnosis.”

State-Level Divergence

States running their own marketplaces have fared significantly better than those relying on the federal platform. State-based exchanges retained far more customers, losing only 8% since the start of the year, compared to steeper losses in federal marketplace states. New Mexico, which fully backfilled lost federal subsidies with state funds, actually grew enrollment.

This growing divide highlights a key dynamic: states with the resources to replace federal cuts can protect their residents, while others cannot. The Congressional Budget Office projected average monthly ACA Marketplace enrollment of 16.9 million for 2026, closely aligning with KFF’s estimates.

Political Fallout and Market Stability

The enrollment crisis has become a major political issue ahead of the 2026 midterm elections. A KFF poll found that two-thirds of Americans believe Congress did the “wrong thing” by failing to extend the enhanced subsidies. Health care costs rank as Americans’ top affordability concern — above groceries and utilities.

“It is a terrible political look for congressional Republicans, and it’s a terrible reality for many of their constituents who are going to face these skyrocketing premium payments,” said Jonathan Oberlander, a health policy political scientist at UNC Chapel Hill.

Meanwhile, the market faces serious stability concerns. As healthier people drop coverage, the remaining risk pool becomes sicker and more expensive to insure, raising the specter of a “death spiral.” Major insurers including Blue Cross Blue Shield Association, Centene, and UnitedHealth have reported significant year-over-year enrollment declines. Cigna has announced it will exit the marketplaces entirely in 2027.

Analysts predict “double-digit” rate hikes for 2027. “We know for sure that the individual market has gotten smaller and almost certainly sicker, as the people dropping coverage are more likely to be healthy,” said Louise Norris, a health policy analyst at healthinsurance.org.

What’s Next

The full picture of the enrollment decline may not be clear for some time. CMS effectuated enrollment data — reflecting who actually paid premiums — will not include demographic breakdowns until later this year. A grace period for returning enrollees extended into late March, meaning complete data may take another year to materialize.

Key questions remain: Will Congress revisit enhanced subsidies before the midterms? How many of the 5 million who dropped coverage became uninsured versus finding alternative coverage? And when Medicaid cuts in the One Big Beautiful Bill Act take effect in 2027, the CBO estimates up to 15 million people could lose coverage — wiping out roughly two-thirds of the coverage gains made under the ACA since 2010.

“The enrollment reductions are real people with real consequences,” said Ellen Montz, managing director at Manatt Health and a former Biden CMS official. “The Affordable Care Act is a political lightning rod, but it’s a critical component of the coverage landscape.”