SouthernWorldwide.com – Enrollment in the Affordable Care Act (ACA) is showing a decline, leading to market uncertainty for insurance providers. This trend is expected to result in increased insurance rates for the upcoming year, following significant hikes experienced this year.
Sign-ups for ACA plans were already down by approximately 1.2 million in January compared to the record enrollment figures from the previous year. This year, enrollees faced an average premium increase of 26%, compounded by the reduction or elimination of subsidies that previously helped offset costs.
Experts are now closely monitoring the number of individuals among the 23 million enrolled who will fail to pay their share of the premiums. While comprehensive data on premium payments is still emerging, some states with their own ACA markets have released preliminary figures.
Georgia has reported the most substantial drop in premium payments, with a 28% decrease in April compared to the same period last year. This observation comes from an analysis by Charles Gaba, a healthcare policy analyst specializing in the ACA.
Internal data from the Centers for Medicare & Medicaid Services (CMS), reported by NOTUS on May 12, suggests that about 21% of individuals using the federal ACA marketplace in 30 states did not pay their January premiums. If accurate, this figure is considerably higher than the previous year.
CMS has not yet responded to inquiries from KFF Health News regarding this enrollment data. Ellen Montz, a managing director at Manatt Health, noted that while the exact extent of the increase in non-payment compared to previous years is not yet quantifiable, it is expected to be worse due to the significant price increases.
These initial findings emerge amidst growing public concern over healthcare costs. Polls indicate that healthcare expenses are a primary concern for voters. A KFF analysis released on May 19 revealed that the average deductible for ACA plans experienced its steepest historical increase, rising by 37% or over $1,000, from $2,759 in 2025 to $3,786 in 2026, as enhanced premium tax credits expired.
These rising costs present a political challenge for President Trump and the Republican party, which has historically opposed enhanced subsidies for ACA coverage. A spending package enacted last year, known as the One Big Beautiful Bill Act, included provisions anticipated to decrease ACA enrollment and was cited as a factor contributing to higher premiums this year.
Montz emphasized that these enrollment reductions represent “real people with real consequences,” and that while the ACA is a political focal point, it remains a vital part of the healthcare coverage landscape.
The current decline in enrollment aligns with predictions made by some policy experts, largely due to Congress not extending the enhanced benefits that expired at the end of last year. These enhanced subsidies had been in effect since 2021.
A report from the Wakely Consulting Group, an analysis arm of HMA Co., suggests that the individual market is trending towards a significant contraction in 2026, potentially mirroring projections by the Congressional Budget Office. Based on data from 75 insurers, Wakely estimates that average ACA enrollment could be 17% to 26% lower this year compared to last.
The Wakely report indicates that, on average, 86% of enrollees made their initial payment in January. The rate of premium non-payment varied by state. States that provided additional financial assistance, such as backfilling reduced subsidy amounts with state funds, or those that experienced lower premium increases, had the lowest drop-off rates.
States operating their own ACA exchanges reported higher payment rates (92%) compared to those utilizing the federal marketplace (82% to 84%). Gaba’s analysis, which includes more recent data from nine state-run marketplaces, suggests that Georgia’s situation might be representative of other states that did not implement additional protections. For instance, payment failure rates in New Jersey were 11.6% as of April, 15.7% in Washington state as of February, and 8.5% in California.
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Only New Mexico, among the states in Gaba’s sample, saw an increase in the percentage of individuals making premium payments. This was attributed to the state allocating its own funds to fully compensate for the reduced federal subsidy amounts.
ACA enrollment figures are dynamic. Typically, more individuals enroll initially than end up paying premiums, leading to higher numbers at the beginning of the year. People may drop coverage throughout the year for various reasons, including obtaining insurance through employment or a spouse. Cost is a significant factor; with increased premiums and decreased subsidies, many individuals are now facing costs at least double what they previously paid.
Additionally, the Trump administration discontinued a special enrollment program that allowed low-income individuals to enroll year-round. Some critics of the ACA, such as the Paragon Health Institute, argue that enrollment declines should not solely be attributed to rising costs. Paragon has contended that record enrollment numbers in recent years were inflated by potentially millions of fraudulent sign-ups.
Insurers, hospitals, and policy experts have questioned Paragon’s methodology for estimating improper enrollments, suggesting that the figures may be significantly overestimated. Brian Blase, president of Paragon, reiterated the organization’s findings in a recent newsletter, projecting that approximately 19 million people would be enrolled by the end of 2026. He noted that even at this level, the market would be 90% higher than the pre-COVID average.
However, other experts primarily attribute the decrease in enrollment to cost. For individuals who experienced the ACA for the first time after the enhanced tax credits expired, the increase in costs was particularly substantial. Sabrina Corlette, co-director of the Center on Health Insurance Reforms at Georgetown University, stated that basic economic principles dictate that higher prices lead to lower demand.
The expectation of a continued downward trend in enrollment is a key factor that will likely influence insurers’ rate calculations for 2027. It remains unclear how many individuals will maintain their coverage and whether those who remain will utilize healthcare services more than insurers anticipate. It is generally believed that younger or healthier individuals are more prone to dropping coverage when premiums rise.
Furthermore, there has been a notable shift by consumers towards selecting bronze-level plans, which offer lower monthly premiums but higher deductibles. A KFF analysis found that sign-ups for bronze plans increased from 30% to 40% of total plan selections, rising from 7.3 million in 2025 to 9.2 million this year. This raises questions about future payment patterns and potential cost shifting to healthcare providers.
Insurers incorporate such analyses into their premium setting. Another concern for actuaries is the delayed release of a critical regulation outlining the rules for ACA health plans for the upcoming year. The initial 2027 proposal from the Trump administration, released in mid-February, included significant changes such as increased deductibles for certain ACA plans and the allowance of plans without defined provider networks. This regulation was not finalized until May 15, well into the period when insurers typically calculate premiums.
Many of the proposed changes, with some modifications, were approved, including provisions for higher annual deductibles in certain coverage types. Louise Norris, a health policy analyst for healthinsurance.org, described the current year as challenging for actuaries, noting that the individual market has become smaller and likely sicker, as healthier individuals are more likely to discontinue coverage.
Michelle Anderson, a director at Wakely and co-author of a recent report, stated that while insurers are not yet expressing extreme concern, they are closely monitoring trends. Anderson does not anticipate an average premium increase of 26% like the one seen this year. However, she expects the ongoing uncertainty and the projected decline in enrollment, which will vary by state and insurer, to influence next year’s premium rates. She indicated that double-digit increases are a possibility.
KFF Health News reporter Rachel Spears contributed to this article.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.
