Affordable Care Act enrollment continues to erode as some customers struggle to make premium payments, and declining numbers create market uncertainty for insurers. In response, insurers are likely to raise rates again next year, following larger-than-usual hikes this year.
Registrations had already decreased in January by about 1.2 million from last year's record. For this year, members faced premiums that increased, on average, 26%. On top of that, subsidies that help people buy coverage have been reduced or gone.
Now experts are looking at how many of the roughly 23 million people who signed up won't pay their share of premiums.
While available data on premium payments is primarily for January, some states that run their own ACA marketplaces have released information for later months. The steepest drop in the number of people paying premiums, based on limited data, is in Georgia, which saw a 28% drop in April compared to the same period a year earlier, according to an analysis by Charles Gaba, a health care policy analyst and blogger specializing in the ACA.
The NOTUS news website reported on May 12 that it had internal data from the Centers for Medicare and Medicaid Services showing that about 21% of people using the federal ACA marketplace (30 states) did not pay their share of January premiums, which, if correct, is much higher than the same time last year.
CMS did not respond to questions from KFF Health News about enrollment data.
Looking at the first numbers released by analysts, “we can't yet quantify how much worse it will be than in previous years, but it will definitely be worse because of the label shock,” said Ellen Montz, managing director at consulting firm Manatt Health, who helped oversee the ACA during her tenure in the Biden administration.
The initial results come amid growing public concern about affordability, and polls show that health care costs are often a priority for voters.
A KFF analysis published May 19, for example, found that the average ACA plan deductible saw the steepest increase in history: It grew 37%, or more than $1,000, from $2,759 in 2025 to $3,786 in 2026 as enhanced premium tax credits expired.
Those rising costs pose a political challenge to President Donald Trump and the broader Republican Party, which has opposed increased subsidies to help people buy Obamacare coverage. Republican lawmakers also passed a spending package last year, enacted as the One Big Beautiful Bill, that included provisions expected to reduce ACA enrollment and was cited among the factors driving higher premiums this year.
The tuition reductions “are real and have real consequences,” Montz said. “The Affordable Care Act is a political lightning rod, but it is a critical component of the coverage landscape.”
Following the numbers
Right now, the rate of decline is in line with what some policy experts predicted, in part because Congress did not extend generous benefits that expired at the end of last year. Those enhanced subsidies were in effect from 2021.
“Overall, the individual market appears trending toward a significant contraction in 2026, and may well resemble” the declines projected by the Congressional Budget Office, said a report from Wakely Consulting Group, an analysis arm of HMA Co.
Based on his analysis, drawn from data provided by 75 insurers, Wakely estimates that average ACA enrollment will end up being 17% to 26% lower this year than last.
So far, according to the Wakely report, an average of 86% of enrollees made their first payment in January.
Nonpayment of premiums varied by state. Those with the lowest dropout rates had enacted additional help (such as replacing some or all of their reduced subsidy amounts with state money) or experienced lower premium increases. States that run their own exchanges had higher payment rates (92%) than those served by the federal exchange (82% to 84%).
Gaba's initial data analysis includes more recent figures from nine of the 20 states that run their own Obamacare marketplaces.
“Georgia could be quite representative” of other states that did not enact additional protections, Gaba said. For example, year-over-year default rates were 11.6% in April in New Jersey and, in February, 15.7% in Washington state and 8.5% in California.
Only one state in their sample, New Mexico, saw an increase in the percentage of people making premium payments, according to the latest monthly data available. Unlike most, it had set aside state money to fully offset lower federal subsidy amounts.
ACA enrollment numbers are never static. Traditionally, more people enroll (either through automatic re-enrollment or taking the initiative to purchase) than actually pay premiums, so the numbers tend to be higher at the beginning of the year.
People drop out over the course of a year for many reasons, such as finding other coverage through a job or marrying someone who has insurance.
Cost, of course, is a factor. This year, as premiums increased and subsidies decreased, many people faced costs at least double what they previously paid for their coverage.
And the Trump administration ended a special enrollment program that allowed low-income people to enroll year-round.
Some critics of the ACA say enrollment declines should not be viewed solely in the context of rising costs. Paragon Health Institute, a free-market think tank that has become influential among conservatives on Capitol Hill, has long argued that record enrollment numbers in recent years were driven by fraudulent enrollments, perhaps in the millions.
Insurers, hospitals and policy experts took issue with the methodology used by Paragon to estimate inadequate enrollments, saying they were likely greatly overestimated.
In a recent Paragon newsletter, the organization's president, Brian Blase, doubled down on the fraud findings. Using data detailing how many people missed premium payments each year, on average, from 2014 to 2019 (the year before Covid emerged and two years before enhanced subsidies took effect), he offered this prediction for 2026: About 19 million people would be enrolled by the end of the year. Even so, the note says, “the market would be 90% higher than the pre-COVID average.”
For other experts, however, the main explanation for the drop in enrollment is cost.
Some people had never experienced the ACA before the enhanced tax credits took effect, so they faced an additional shock.
“In economic theory, it doesn't matter if you're left, right or center, it's a simple fact that when you raise the price of something, fewer people will buy it,” said Sabrina Corlette, co-director of Georgetown University's Center on Health Insurance Reforms.
The long term vision
The expectation that a trend toward lower enrollment will continue is one of the key factors that will likely translate into higher cost estimates as insurers craft rates for 2027.
For one thing, while it's still unclear how many people will remain enrolled, it's also unknown whether those enrollees will file more medical claims than insurers projected. It is generally thought that younger or healthier people are more likely to drop coverage when faced with rising premiums.
Second, there has been a sharp shift by consumers to purchase bronze-level plans, which have smaller monthly premiums but higher deductibles (the amount people must pay out of pocket for most treatments, except preventive care, before insurers contribute). KFF's analysis found that bronze plan enrollments increased from 30% to 40% of total plan selections, growing from 7.3 million in 2025 to 9.2 million people this year. Will they pay? Or will hospitals and doctors be hit by uncollected copays or deductibles and then raise prices to compensate?
Insurers base their premiums, in part, on such analyses.
Another worrying factor for actuaries is the late release of a key regulation that sets next year's rules for ACA health plans. The Trump administration's initial 2027 proposal came out in mid-February and included aggressive new ideas, such as sharply increasing deductibles for certain types of ACA plans or allowing insurers to offer plans without established networks of medical providers. It wasn't finalized until May 15, when insurers are calculating premiums for the following year. Many of the proposed changes, with some modifications, were approved, such as allowing higher annual deductibles on some types of coverage.
“This is definitely a challenging year to be an actuary,” said Louise Norris, health policy analyst at healthinsurance.org, a consumer information and reference website affiliated with Trove Group, an insurance agency.
“We know for a fact that the individual market has become smaller and almost certainly sicker, as people who drop out of coverage are more likely to be healthy.”
While “no big red flags are waving” yet, insurers are watching the trends closely, said Michelle Anderson, a director at Wakely and co-author of the recent report.
Anderson does not expect an average 26% premium increase like that seen this year.
Still, Anderson expects the current uncertainty and projected decline in enrollment, which will vary by state and insurer, to play a role in setting next year's premium rates.
“I wouldn't be surprised if there were some double-digit increases,” Anderson said.
KFF Health News reporter Rachel Spears contributed to this article.
