Impact of ACA Subsidy Changes on Health Insurance Enrollment and Premiums

The Centers for Medicare and Medicaid Services (CMS) project a slight decline in Affordable Care Act (ACA) health insurance enrollments, with expectations of 15.6 million enrollees by 2026, compared to approximately 16 million last year. This anticipated decrease aligns with the conclusion of the enhanced federal subsidies, which were initially introduced during the pandemic and scheduled to expire on December 31, 2025. The withdrawal of these subsidies is set to impact the insurance industry significantly, with expected premium increases.

The average annual premium for subsidized ACA plans is forecasted to rise to $1,904 in 2026, compared to $888 in 2025, doubling the financial burden on policyholders. CMS Administrator Mehmet Oz attributes the enrollment drop partly to agency efforts targeting fraudulent enrollments. Current CMS data reflect a marginal decrease in policy renewals, from 20.5% to 19.9%, emphasizing potential impacts on regulatory compliance and risk management strategies.

A survey by KFF reveals that 25% of respondents may drop their insurance coverage if premiums increase as projected, underscoring payer and provider concerns. Without congressional action to renew the subsidies, about 24 million individuals could face increased costs with the onset of 2026. As the industry braces for these shifts, insurers and state health officials anticipate enrollment declines, while legislative efforts to create alternative solutions remain in discussion. ACA enrollment, however, remains open until January 15, maintaining a critical focus for carriers and underwriting professionals navigating this evolving landscape.