Affordable Care Act Enrollment Holds Stronger Than Expected Despite Premium Increases

Unexpected Resilience in ACA Sign-Ups After Subsidy Cuts

Despite dire predictions from health policy experts, the Affordable Care Act (ACA) has shown unexpected resilience following the expiration of enhanced premium subsidies at the end of 2024. While enrollment did decline, the drop wasn’t as catastrophic as many anticipated. The drama surrounding the 2026 open enrollment period was unprecedented, marked by the longest government shutdown in U.S. history as Congress debated extending the more generous subsidies introduced during the Biden administration. These enhanced subsidies had lowered the percentage of household income people needed to spend on healthcare and removed income caps, making coverage accessible to millions more Americans. When they expired, nearly everyone purchasing ACA coverage saw their costs increase—sometimes doubling or more—even though less generous subsidies remained available. The Congressional Budget Office had warned that 2.2 million people would lose insurance in 2026 without the enhanced subsidies, with additional losses expected in subsequent years. Katherine Hempstead from the Robert Wood Johnson Foundation summed up the general expectation: when prices rise significantly, economics tells us fewer people will purchase the product. Yet the initial numbers suggest Americans are proving more determined to maintain health coverage than economists predicted, even as they face significantly higher out-of-pocket costs.

The Numbers Tell a Complex and Incomplete Story

The initial enrollment figures released in late January showed approximately 23 million people signed up for coverage through federal and state marketplaces combined, representing a decrease of about 1.2 million from the previous year’s 24.2 million. New enrollees numbered 3.4 million, down from 3.9 million the year before. However, these numbers don’t tell the complete story and may be misleading for several reasons. First, the data collection wasn’t standardized across all marketplaces. While the federal healthcare.gov marketplace closed enrollment on January 15, state-run marketplaces in many cases only reported data through January 10 or 11, even though some kept enrollment open until month’s end. This timing discrepancy means we’re missing crucial information about whether there was a last-minute surge in sign-ups or, conversely, an increase in cancellations. Second, the initial numbers include both new enrollees and existing customers who were auto-reenrolled for 2026, which creates another layer of uncertainty. Many existing policyholders may have been automatically reenrolled without closely examining their new premium costs, or they may have hoped Congress would extend the subsidies retroactively. The true picture won’t emerge until we see how many people actually pay their premiums in the coming weeks and months. As Pat Kelly from Your Health Idaho explained, consumers may discover they truly can’t afford the premiums and cancel their plans, while insurance carriers may also terminate coverage for non-payment. This means the Congressional Budget Office and consulting firm estimates of millions losing coverage—which were based on full-year enrollment, not initial sign-ups—could still prove accurate.

Geographic Variations Reveal Different State Strategies

The impact of subsidy cuts has varied dramatically across different states, revealing a patchwork response to the federal policy change. Among the 20 states and the District of Columbia that run their own exchanges, most experienced lower enrollment for 2026, with North Carolina seeing the steepest decline at nearly 22%. However, a handful of states bucked this trend, with New Mexico, Texas, California, Maryland, and the District of Columbia all reporting increases in enrollment. New Mexico’s approach was unique and particularly effective: the state used its own tax dollars to completely offset the loss of enhanced federal subsidies for all residents, resulting in a nearly 14% enrollment increase. Several other states, including California, Colorado, Maryland, and Washington, provided partial state-funded assistance to some enrollees, which helped cushion the blow. Meanwhile, troubling patterns are emerging in states without such safety nets. The State Marketplace Network reported that compared to the previous year, plan cancellations jumped 83% in Colorado, disenrollments quadrupled in Idaho, and Virginia saw cancellations double. California experienced a 32% decline in new enrollments, while Pennsylvania saw particularly high termination rates among people ages 55 to 64—the group facing the highest premiums—and young adults ages 26 to 34. Devon Trolley, executive director of Pennsylvania’s health exchange, reported that 70,000 people dropped coverage in just two months, including early retirees, small-business owners, and farmers struggling to make ends meet. By February, Pennsylvania’s final numbers showed a 2% overall enrollment drop, but nearly 18% of enrollees dropped coverage entirely, with older and rural residents most affected.

The Fraud Debate and Real Reasons for Declining Enrollment

Some Republican officials and Trump administration supporters have attributed enrollment declines to anti-fraud measures implemented to tighten the ACA system, including various regulatory and legislative changes. These critics, who have produced controversial estimates suggesting millions may have been improperly enrolled, argue that more generous subsidies enabled unauthorized enrollments and plan-switching by commission-seeking brokers. However, this explanation doesn’t align with evidence from states running their own marketplaces. These state-based platforms employ additional safeguards to prevent brokers from accessing consumers’ coverage without authorization and have reported little or no unauthorized switching. The states’ own investigations paint a very different picture of who’s leaving the marketplace and why. Mila Kofman, executive director of the DC Health Benefit Exchange Authority, explained that when they examined who wasn’t returning to the marketplace, the main reason was cost, not fraud. Notably, half of those leaving were small-business owners—hardly the demographic committing fraud. This finding is consistent across multiple state marketplaces and contradicts the narrative that tightened fraud controls explain the enrollment decline. The reality appears to be straightforward: when subsidies disappeared and premiums increased dramatically, many middle-class Americans—particularly self-employed individuals and small-business owners who don’t have access to employer-sponsored insurance—simply couldn’t afford coverage anymore. These are exactly the people the ACA was designed to help, and they’re making impossible choices between health insurance and other necessities.

The Shift to High-Deductible Bronze Plans

Among those who remained in the marketplace, a dramatic shift occurred in the types of plans people selected. Rather than accepting automatic reenrollment in their existing plans, consumers in many states moved aggressively into lower-priced “bronze” plans that come with significantly higher deductibles than silver, gold, and platinum options. In California, 73% of renewing members who switched plans moved to bronze coverage, up dramatically from just 27% the previous year. In Maine, bronze enrollment now represents almost 60% of all plans purchased. This shift represents a calculated gamble by consumers who are prioritizing immediate affordability over comprehensive coverage. As Stacey Pogue from Georgetown University’s Center on Health Insurance Reforms observed, people are “looking at what works in their monthly budget, looking for that lower premium,” and “some might be crossing their fingers that they won’t need to meet their deductible.” Bronze plans typically carry annual deductibles averaging $7,500, meaning most healthcare expenses must be paid out-of-pocket before insurance coverage begins, with the exception of certain preventive services like vaccinations and cancer screenings that ACA plans must cover without cost-sharing. While this strategy reduces monthly premium costs, it creates significant financial vulnerability if medical care is needed. Katherine Hempstead from the Robert Wood Johnson Foundation warned that high deductibles often lead patients to avoid seeking medical care, delaying treatment until conditions become more serious and potentially more expensive to treat.

Long-Term Consequences for Patients and Healthcare Providers

The ripple effects of subsidy cuts and the shift to high-deductible plans extend far beyond individual enrollees to impact the entire healthcare system. Hempstead noted that people with high-deductible plans are often “terrified to use their care,” creating a troubling situation where insured Americans behave like uninsured ones, avoiding necessary medical attention due to cost concerns. This phenomenon of “underinsurance” undermines one of the ACA’s core purposes: ensuring people can access healthcare when they need it. Medical providers, including hospitals and physicians, are bracing for a significant increase in insured patients who cannot afford to pay their deductibles, even though they technically have coverage. The healthcare industry anticipates needing to provide substantially more charity care, which will hurt hospitals’ bottom lines and could force difficult decisions about laying off staff, reducing services, or even closing facilities, particularly in rural and underserved areas already facing financial pressures. The situation highlights a fundamental tension in American healthcare policy: the challenge of making insurance affordable while ensuring it provides meaningful coverage. The enhanced subsidies that expired represented one approach to this problem, making both premiums and out-of-pocket costs manageable for millions of Americans. Their loss has created a natural experiment in what happens when that support disappears, and early results suggest many people are choosing coverage that protects them from catastrophic costs but leaves them vulnerable to substantial medical bills—or choosing to go uninsured entirely. As the year progresses and more complete data becomes available, policymakers will gain clearer insight into the full human and economic costs of allowing the enhanced subsidies to expire, information that will prove crucial for future debates about healthcare affordability and access.