Expansion of Off-Exchange ACA Plans and ICHRA Impact
In 2026, U.S. health insurers significantly expanded their off-exchange Affordable Care Act (ACA) plan offerings, even as participation in on-marketplace plans decreased. This shift aligns with growing interest in Individual Coverage Health Reimbursement Arrangements (ICHRA) and concerns about the uncertain future of enhanced premium tax credits. Notably, the Robert Wood Johnson Foundation (RWJF) reported that UnitedHealth Group increased its off-exchange offerings by more than fourfold, entering 20 new states. Elevance, Oscar, and Caresource also enhanced their off-exchange presence.
According to RWJF data, on-exchange plans decreased by 7%, dropping from about 12,600 in 2025 to 11,700 in 2026. Conversely, off-exchange offerings saw significant growth, rising by over one-third from approximately 6,600 to nearly 9,000 plans. This marks the first time off-exchange options have accounted for over 40% of the individual market since 2017.
On-exchange plans, available through federal and state ACA marketplaces, include tax subsidies. Meanwhile, off-exchange plans, though ACA-compliant, are sold directly by insurers without subsidies. The reduction in marketplace options is partly due to insurer exits, including Aetna and various regional providers, with Cigna announcing its departure from the ACA segment.
Influence of ICHRA Market Expansion
Katherine Hempstead, a senior policy advisor at RWJF, highlighted that the expansion of off-exchange plans is influenced by the burgeoning ICHRA market. These arrangements allow employers to subsidize employees' individual market coverage, offering potential tax benefits for employees who opt for off-exchange plans. Hempstead pointed out that insurers are incentivized to develop more ICHRA products off-exchange, resembling employer-sponsored plans.
Several states have witnessed shifts in market dynamics. In states like Illinois, Kansas, and Wisconsin, insurer withdrawals have led to reduced marketplace offerings, while Georgia and Alabama experienced significant growth in off-exchange plans.
Future Growth and Policy Shifts
Enrollment remains stronger in ACA marketplaces, with estimated off-exchange market enrollment around 3 million in 2025, compared to ICHRA enrollments ranging from 400,000 to 800,000. The report outlines how policy changes could impact future growth. The potential expiration of enhanced premium tax credits (ePTC) at the end of 2025 may drive more consumers toward unsubsidized plans, boosting off-exchange growth.
Hempstead remarked on the potential challenges if ePTCs expire, which could lead to a more expensive and less healthy individual market, affecting both on- and off-exchange offerings. If off-exchange plans continue to grow, they might surpass marketplace options as early as next year. Nonetheless, this will depend on various factors, including market conditions and future policy changes. A shift from group to individual markets could benefit both on- and off-exchange offerings, as they share the same risk pool, though the full impact remains uncertain.