ACA Enrollment Could Fall By 5 Million As Enhanced Health Insurance Subsidies Expire
The Affordable Care Act (ACA) marketplaces are experiencing a significant drop in enrollment this year, as some subsidies for health insurance plans purchased on U.S. states’ marketplaces are expiring. According to KFF, more than 22 million Americans were insured through ACA marketplaces in 2025, but this number is expected to fall to just 17.5 million in 2026.
During the open enrollment period at the beginning of 2026, sign-ups and renewals only decreased by about a million. However, experts estimate that as many enrollees fail to pay their now much higher premiums, the real number of insured people will drop five million below last year’s level.
During the Biden administration, the federal government widened subsidies for ACA coverage. Enhanced premium tax credits meant that Americans with incomes above 400% of the federal poverty line could receive tax credits on their health plans for any cost exceeding 8.5% of their income. However, as of 2026, anyone earning more than 400% of the federal poverty line will once again pay the full price of their insurance, leading to drastic price increases for many individuals.
Income caps spelled out in premium tax credit rules are also rising slightly for people earning more than their state’s limit for Medicare coverage but less than 400% of the federal poverty level. Additionally, insurance plans have been subject to high inflation between this year and last year, making health insurance unaffordable for ACA marketplace users of different income levels.
Data published by KFF shows a significant decrease in the number of ACA marketplace enrollees with incomes around 400-500% of the federal poverty level. Enrollment has decreased in several states, with the biggest rise in enrollment seen in New Mexico, where the state legislature has designated $40 million to fill the gap of the expired federal subsidies.
Due to the higher prices of insurance plans, many individuals who would still receive premium tax credits have also dropped coverage. Employer-sponsored plans are also expected to increase in price by almost 7% this year, adding an extra burden for employees and employers. The rise in cost is attributed to factors such as the increased use of pricey GLP-1 weight loss drugs.
Overall, the changes in subsidies and rising costs are causing a significant impact on ACA marketplace enrollment and affordability for many Americans. It remains to be seen how policymakers and stakeholders will address these challenges in the coming years.
