Declining ACA Health Insurance Renewals as Pandemic Subsidies Expire

ACA Health Insurance Renewals Decline with Expiration of Pandemic Era Subsidies

As 2026 approaches, health insurance renewals under the Affordable Care Act (ACA) are slowing dramatically. The Centers for Medicare and Medicaid Services (CMS) project enrollment figures will drop to approximately 15.6 million participants, down from 16 million last year. This decrease is largely due to the expiration of COVID-19 financial subsidies, which end on December 31, 2025, impacting many industry stakeholders.

During the pandemic, federal enhanced subsidies had temporarily reduced healthcare coverage costs. With these subsidies concluding, premiums for subsidized plans are expected to rise. Government estimates predict the average annual premium will almost double from $888 in 2025 to about $1,904 in 2026, presenting significant challenges for lower- and middle-income households concerning regulatory compliance requirements and risk management.

Implications for ACA Participants and Industry Discussions

Recent CMS data highlights a decrease in policy renewal rates: only 19.9% of ACA enrollees have renewed coverage this month, down from 20.5% last year. CMS Administrator Mehmet Oz cites enhanced anti-fraud measures as partly responsible for this slowdown. Meanwhile, a survey reveals that around 25% of ACA customers are considering discontinuing coverage due to increased premiums, potentially affecting up to 24 million individuals.

The renewal phase, which started in November and runs until January 15, usually sees a rise in renewals in early January. However, without subsidies, growth may dwindle. Ongoing political discourse complicates matters further, especially with Republican Party divisions over healthcare proposals, resulting in uncertainty for those reliant on ACA coverage. Without a clear alternative plan gaining traction, the expiry of federal subsidies and rising premiums pressurizes the U.S. health insurance sector, leaving many Americans with challenging health coverage decisions in 2026.