5 Million Drop ACA Insurance After Premiums Skyrocket
Five million fewer Americans are enrolled in Affordable Care Act marketplace plans in 2026 compared to last year’s record high, according to newly released federal data. The dramatic 21% enrollment decline — from 24.2 million to 19.2 million — comes after the expiration of enhanced premium tax credits sent monthly premium payments soaring by an average of 58% and deductibles to record highs.
As NPR reported, the drop reflects a combination of 1 million fewer plan selections during Open Enrollment and 4 million additional enrollees who either disenrolled or failed to pay their premiums. The Department of Health and Human Services published the data on Friday.
How the Subsidies Expired
The enhanced premium tax credits were created by the American Rescue Plan Act of 2021 and extended through 2025 by the Inflation Reduction Act. These subsidies eliminated the “subsidy cliff” that previously cut off financial assistance for those earning above 400% of the federal poverty level, capped premium payments at 8.5% of income, and drove ACA marketplace enrollment from roughly 12 million to a record 24.2 million.
When Congress failed to extend the enhanced credits at the end of 2025, the consequences were swift. A record-long government shutdown in the fall of 2025 — triggered when Democrats demanded a three-year subsidy extension in stopgap funding and Republicans blocked the effort — ended without a deal, as CNBC reported.
The Cost of Losing Coverage
According to a KFF analysis, average monthly premium payments rose 58%, from $113 to $178 per month. KFF had initially projected a 114% increase if all enrollees had stayed in the same plans, but many consumers switched to cheaper, higher-deductible plans or dropped coverage entirely.
Average ACA marketplace deductibles rose 37% — about $1,027 per person — to a record high of $3,786 in 2026, marking the steepest increase ever recorded. The share of enrollees selecting Bronze plans, which carry lower premiums but higher out-of-pocket costs, rose from 30% (7.3 million) in 2025 to 40% (9.2 million) in 2026.
Who Was Hit Hardest
Consumers above 400% of the federal poverty level — the “subsidy cliff” — made up just 7% of 2025 enrollment but accounted for nearly half (48%) of the decline in plan selections. Young adults ages 18 to 34 accounted for 46% of the total decline, with 542,000 fewer sign-ups, an 8% drop.
Plan selections declined in 41 states. The largest percentage drops were in North Carolina (22%), Ohio (20%), West Virginia (17%), and Indiana, Delaware, and Arizona (all 16%). New Mexico bucked the trend with an 18% increase, partly due to its state supplemental financial assistance program that temporarily backfills the lost federal premium assistance.
Fraud or Affordability? The Core Debate
The Trump administration and the conservative Paragon Health Institute have argued that much of the prior enrollment growth was driven by fraud, and that the current decline reflects successful anti-fraud efforts. CMS reports removing nearly 1.5 million improper enrollments from the HealthCare.gov platform in 2025.
However, most health policy experts are skeptical that fraud explains the magnitude of the 5 million drop. Cynthia Cox, director of KFF’s Program on the ACA, told NPR: “The main takeaway is that enrollment is down 13% from last year. While the Trump administration attributes this drop in enrollment to their attempts to address fraud, this coverage loss happened at the same time millions of people faced double or even triple digit increases in their premium payments with the expiration of enhanced tax credits.”
Stacey Pogue, senior research fellow at the Georgetown Center on Health Insurance Reforms, agreed. “I don’t see data that point to that conclusion that a 5 million person drop can be explained by allegations of fraud,” she said. “There’s lots of evidence pointing to people making decisions based on what they can pay each month.”
What Comes Next
Early rate filings for 2027 show premiums will rise again, with double-digit increases expected. According to a Georgetown CHIR analysis, statewide average proposed increases range from 6.5% in Vermont to 22.4% in Washington.
Several insurers, including Cigna, have announced they will not participate in ACA markets in 2027, citing rising costs, declining enrollment, and policy uncertainty. Cigna president Brian Evanko indicated there was no “clear path” to scale the company’s ACA business.
Cynthia Cox said she does not see an imminent “death spiral” — where healthier people drop coverage, leaving a sicker risk pool that drives premiums even higher. “I think there are still enough people buying ACA marketplace coverage and that’s going to keep these markets working,” she said. “At this point, we don’t see any parts of the country that are at risk of having no insurance company.”
More than half of ACA enrollees live in Republican congressional districts, according to KFF, meaning the impact of the enrollment decline crosses party lines. With healthcare affordability emerging as a central issue in the 2026 midterm elections, the question of whether Congress will revisit the enhanced subsidies — or pursue alternative policies — remains open.