Impact of ACA Subsidy Expiration on Health Insurance Enrollment Trends

Health insurance enrollment under the U.S. Affordable Care Act (ACA) is expected to drop to 15.6 million by 2026, as reported by the U.S. Centers for Medicare and Medicaid Services (CMS). This anticipated decline follows the expiration of expanded federal subsidies, likely leading to significant premium increases beginning in 2026. Monthly premiums for subsidized ACA plans are projected to rise, averaging $1,904 annually, compared to $888 in 2025.

The reduction in enrollment figures also reflects efforts by CMS to address fraudulent and improper sign-ups, though detailed data on these initiatives remain unavailable. The renewal rate for ACA coverage has slightly decreased, with 19.9% of enrollees choosing to renew, down from 20.5% the previous year. These regulatory compliance requirements play a crucial role in the industry's efforts to combat fraud.

The lapsed subsidies, not renewed by Congress, may impact around 24 million Americans. According to a survey by the health policy organization KFF, 25% of enrollees might opt out of health insurance coverage in 2026 if premiums rise as forecasted. This trend poses significant risk management challenges for insurers and could influence payer and provider strategies.

The ACA enrollment period opened in November and will close on January 15. Historically, this period witnesses increased sign-ups, often rising each year, with enrollment doubling from 12 million in 2021 due to previously expanded subsidies. As the insurance industry navigates these changes, carrier and underwriting strategies must adapt to the evolving market landscape.

The search for a replacement solution to maintain ACA's consumer protections continues to engage policymakers, though no concrete plan has yet been finalized. Insurers, alongside state health officials, are preparing for potential enrollment decreases in 2026, aligning their claims and underwriting processes with the anticipated regulatory shifts.