ACA enrollment drops by over 1 million for 2026 after COVID-era subsidies expire

Enhanced Subsidies Expired on New Years Eve

For four years, federal tax credits kept Obamacare affordable for millions of Americans.

Monthly premiums dropped to zero for some families. Enrollment doubled.

Then, on December 31, 2025, those enhanced subsidies expired after Congress failed to extend them.

Now, roughly 1.5 million fewer people have signed up for ACA coverage compared to last year.

The amount subsidized enrollees pay out of pocket has more than doubled, and millions of Americans are facing an impossible choice: pay hundreds more each month or go without health insurance entirely.

Out-of-Pocket Costs Jumped 114% Overnight

The average ACA enrollee who received subsidies in 2025 paid about $888 annually for their health plan.

In 2026, that same coverage now costs around $1,904 out of pocket. That is a 114% increase in what enrollees pay after losing the enhanced subsidies, and it happened the moment the calendar flipped to January 1.

For a 60-year-old couple earning $85,000 a year, the damage is even worse. Their annual premium jumped by more than $22,600.

The math simply does not work for many households, which is why so many are walking away from coverage altogether.

A 43-Day Shutdown Changed Nothing

The fight over these subsidies triggered the longest government shutdown in American history.

It started on October 1, 2025, when Congress failed to pass a spending bill amid disagreement over the subsidy extension.

The shutdown lasted 43 days before a bipartisan deal was reached to reopen the government in exchange for a promise that the Senate would vote on the subsidies in December.

That vote happened.

Senate Republicans rejected a three-year extension on December 11. Congress left for the holidays with no deal.

Record Enrollment Crumbled Fast

ACA marketplace enrollment had more than doubled since 2020, growing from 11.4 million to a record 24.3 million in 2025.

Health policy experts credited the enhanced subsidies for nearly all of that growth. The tax credits made coverage so affordable that four out of five consumers could find a plan for $10 or less per month.

Now, 22.8 million people have signed up for 2026 coverage, a decline of about 1.5 million from last year.

And those numbers will likely drop further as people fail to make their first premium payments.

Red States Got Hit the Hardest

About 88% of the total ACA marketplace growth since 2020 came from states that voted for Donald Trump in 2024.

Texas, Florida, and Georgia saw some of the biggest enrollment surges during the subsidy years.

Enrollment more than tripled in Texas, Mississippi, West Virginia, Louisiana, Georgia, and Tennessee.

Now those same states face the steepest losses.

Florida enrollees received billions in premium tax credits in 2025, the highest of any state, while Texas also received substantial assistance.

That money is gone.

The Subsidy Cliff Returned

Before 2021, Americans earning more than 400% of the federal poverty level were completely ineligible for any premium subsidies.

If you earned even one dollar over the limit, you paid full price. The enhanced subsidies eliminated that cliff.

Now it is back. For 2026, the cutoff is about $62,600 for an individual and $84,600 for a couple.

People just barely over that line will be hit harder than those who earn even higher incomes because they lose all assistance at once.

Early Retirees Face Brutal Math

Many ACA enrollees in 2025 were at least 55 years old.

Many of them retired before becoming eligible for Medicare at 65, or they lost jobs and could not find new ones.

Insurance companies can charge 60-year-olds up to three times what they charge 40-year-olds for the same plan.

When subsidies absorbed that difference, older adults paid manageable amounts.

Now, older adults face significant annual premium increases.

Some States Are Trying to Help

Several states have implemented or expanded state-funded subsidies to cushion the blow.

California allocated $190 million for additional premium assistance for its lowest-income enrollees in 2026.

Connecticut also committed funds to offset the expiring subsidies.

But California’s $190 million does not come close to the $2.5 billion in federal enhanced subsidies that the state’s enrollees received in 2025.

Millions Are Downgrading to Bronze

People who cannot afford to drop coverage entirely are switching to the cheapest plans available.

In Idaho, about 59% of enrollees selected bronze plans for 2026, up from 49% in 2025.

Bronze plans have lower premiums but high deductibles. Deductibles for bronze plans average nearly $7,500 nationally. That means you pay thousands out of pocket before most coverage kicks in.

For many families, these plans only protect against total financial ruin from a major medical emergency.

4.8 Million Could Lose All Coverage

Urban Institute economists estimate 4.8 million people will drop their health coverage and become uninsured in 2026.

Mississippi could see its uninsured rate jump by 65%, the highest in the nation. South Carolina could see a 50% increase, followed by Tennessee at 41%.

Southern states face the worst pain because most never expanded Medicaid, leaving low-income residents with no safety net when ACA coverage becomes unaffordable.

Some Are Rolling the Dice

Robert Sory of Thompson’s Station, Tennessee, paid $0 in monthly premiums for his ACA plan in 2025.

When he checked rates for 2026, a bare-bones bronze plan would cost at least $70 a month.

He and his wife Emily, who both lost their jobs in November, decided to go without insurance. “When you don’t have any income coming in, it doesn’t matter how cheap it is,” Robert said. “It’s not affordable.”

They are negotiating directly with their psychiatrist for $125 visits every three months.

Congress Has Acted—Partially

On December 17, 2025, four House Republicans joined all Democrats in signing a discharge petition, forcing a floor vote on a bill to extend the subsidies for three years.

On January 8, 2026, the House passed the extension 230-196, with 17 Republicans joining Democrats.

But the bill now faces an uncertain future in the Senate, where Republicans already voted down a three-year extension in December, citing cost concerns and an unwillingness to extend pandemic-era programs.

State health exchange directors say they are ready to reopen enrollment if Congress acts, but nobody is holding their breath.

This article was created with AI assistance and human editing.

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