Decline in ACA Enrollment: Trends and Economic Pressures

Marketplace Enrollment Slides as Subsidies Expire: What the Early Numbers Mean for Insurers

After several years of record-setting growth, the Affordable Care Act (ACA) individual market is showing its first meaningful signs of pullback.

New federal data cited by national outlets indicate Marketplace enrollment is down to about 22.8 million, roughly 800,000 fewer than last year’s high point above 24 million. (AP News) That drop is arriving alongside a familiar consumer pivot: more shopping behavior, more sensitivity to premium changes, and more interest in lower-premium, higher-deductible designs.

For insurance leaders, this is not just a headline about coverage loss. It is an early indicator of how quickly member mix, plan selection, and retention dynamics can shift when affordability levers change.

“The state is seeing an ‘unprecedented’ number of previously enrolled people dropping coverage.”
Devon Trolley, Executive Director, Pennsylvania Health Insurance Exchange Authority (Pennie) (Bucks County Beacon)

The Big Driver: The Affordability Shock Is Back

The enrollment story and the affordability story are the same story right now.

Enhanced premium tax credits that began in 2021 expanded eligibility and increased subsidy amounts. Congress did not renew them past the end of 2025, and early reporting ties the current enrollment decline directly to that change. (AP News)

On the premium side, 2026 is shaping up to be an outlier year. A major analysis of 2026 filings found average ACA Marketplace premiums increased 21.7%, with the expiration of enhanced tax credits cited as a key reason behind the magnitude of the increase. (Commonwealth Fund)

The operational takeaway for carriers is straightforward: when net premiums rise abruptly for subsidy-sensitive segments, retention becomes a month-by-month process, not a set-it-and-forget-it annual outcome.

A Snapshot of the Enrollment Shift

Here is the simplest way to frame what many payers are watching: the individual market is moving from a growth era to a retention era.

(AP News)

That top-line change masks substantial regional variation, especially where state policy cushions the subsidy drop or where outreach infrastructure is unusually strong.

State Variation: Why the Map Matters More Than the National Total

National declines can hide state-specific realities.

Pennsylvania has become an early signal for retention pressure, especially among previously enrolled members. Reporting has highlighted outsized attrition among enrollees who were already in the market and now face materially higher net premiums. (Bucks County Beacon)

Texas, meanwhile, is one of the most closely watched counterexamples. Multiple reports show Texas enrollment running slightly ahead of last year, even as many experts expected sharp losses when enhanced federal subsidies ended. (Axios)

“Despite national headlines emphasizing higher insurance premiums, Texas is in a better position than many states to maintain affordability.”
Texas 2036 (Texas 2036)

The strategic implication is that state-level rules and funding choices are becoming even more determinative of enrollment stability. As federal affordability support narrows, the gap between “policy-supported markets” and “policy-neutral markets” widens.

What This Means Inside an Insurer’s 2026 Playbook

1) Retention and billing friction become core risk factors

Early coverage losses are not always ideological decisions or plan dissatisfaction. They are often the predictable result of a first premium notice that feels impossible to absorb. Evidence from Maine’s marketplace shows cancellations where consumers explicitly cited affordability after enhanced credits expired. (The Portland Press Herald)

2) Plan selection shifts can change claims timing

When more members gravitate to higher-deductible options, utilization patterns can become more back-loaded. That can alter everything from Q1 cash flow assumptions to care management timing.

3) Re-enrollment behavior is now a measurable performance lever

In a more volatile affordability environment, carriers and exchanges that make re-enrollment easy and communications clear are not just improving member experience. They are protecting the risk pool.

One Practical Checklist for Insurance Leaders

• Stress-test lapse and cancellation scenarios using first-bill sensitivity, not just open enrollment selection counts.

• Audit member communications for clarity on net premium changes and plan alternatives.

• Revisit product portfolio strategy to ensure competitive low-premium options without overexposing the pool to underinsurance dynamics.

• Coordinate more tightly with providers in shortage regions where access constraints can compound dissatisfaction.

• Update broker and assister enablement so front-line guidance keeps pace with changing subsidy realities.

The Bottom Line

The early data point to a market that is still large, still essential, and increasingly shaped by affordability volatility. Enrollment is down from last year’s high, premiums are rising sharply, and state policy choices are starting to separate stable markets from unstable ones.

For insurers, the question is no longer “Can we grow?” It is “Can we keep the members we fought so hard to earn when affordability tightens?”

That answer will be built less on slogans and more on execution: retention analytics, product design discipline, and a member experience that reduces friction precisely when consumers are most likely to walk away.