Millions of Americans are expected to forgo Affordable Care Act (ACA) coverage this year due to escalating costs, according to a new analysis from the healthcare research nonprofit KFF. The report projects that nationwide enrollment in the ACA health insurance marketplace could plummet from 22.3 million in 2025 to approximately 17.5 million in 2026, representing a more than 20% reduction in participants.
Key Findings on Enrollment and Costs
The KFF analysis indicates that the decline is steeper than initial federal data suggested, highlighting how rising health expenses are forcing Americans to make difficult decisions about their coverage. A primary driver is the expiration of federal subsidies on January 1, which previously helped the vast majority of enrollees afford their plans. For those who maintain coverage, the financial burden has increased substantially: the average deductible has grown by over $1,000, and the average monthly premium has risen by $65.
Cynthia Cox, a vice president at KFF and co-author of the report, stated, "No matter how you slice it, people are paying more." She explained that many Americans were automatically renewed into plans from the previous year, which often became far more expensive due to expired subsidies and market dynamics. When individuals can no longer afford the monthly fees, they lose their coverage.
Impact on Middle-Income Americans
The report found that middle-income Americans disproportionately dropped coverage. This group earns too much to qualify for remaining subsidies, which are reserved for low-income enrollees, but not enough to comfortably afford health coverage without the enhanced COVID-era subsidies that have now expired. ACA plans have become a popular choice for working-age Americans who do not qualify for Medicaid, including gig workers, farmers, ranchers, and hairstylists.
While drops in ACA sign-ups were observed across most states, KFF noted that states operating their own exchanges retained a larger percentage of enrollees compared to those relying on the federal marketplace.
Administration Response and Future Outlook
The Trump administration has asserted that federal efforts to combat fraud within the ACA program are largely responsible for this year's enrollment declines. The Centers for Medicare and Medicaid Services (CMS), whose final 2026 enrollment data is not yet public, did not immediately respond to a request for comment on KFF's report.
Last year, anticipating the expiration of the COVID-era subsidies, KFF had projected that premium payments would more than double in 2026. The new analysis, however, found that premium payments jumped by a more modest 58% on average. This was partly because many individuals downgraded to lower-premium, higher-deductible plans, which will only cost them more if they utilize the coverage. "People are trying to hang on to their health insurance coverage any way they can, even if that means they have a deductible of $7,000," Cox said.
Despite the current challenges, Cox expressed some optimism. She noted that insurers appear to have anticipated and already made adjustments for many of the marketplace changes currently unfolding. This could potentially mean that future health costs may not rise as sharply. "I'm hopeful that this could be a one-time market correction and that we might not need to see such a high premium spike in the coming year," Cox concluded.
