Fewer Americans sign up for Affordable Care Act health insurance as costs spike

Fewer Americans are enrolling in Affordable Care Act health insurance plans this year as expiring subsidies push premium costs beyond what many can afford, according to new federal data released Monday.

The Centers for Medicare and Medicaid Services report shows a 3.5% drop in total enrollment compared to the same period last year, with approximately 800,000 fewer people selecting plans. The decline includes both new consumers and existing enrollees who previously relied on ACA coverage.

The current data, which includes sign-ups through January 3 in states using Healthcare.gov and through December 27 in states with their own marketplaces, offers an early but concerning glimpse of enrollment trends. Most states continue to allow plan selections through January 15 for coverage starting in February.

Health policy experts warn that actual enrollment figures may drop even further once enrollees receive their first premium bills in January, potentially leading some to cancel their plans altogether.

“My prediction is 2 million more people will lack health insurance for a while,” said Robert Kaestner, a health economist at the University of Chicago. “That’s a serious issue, but Republicans would argue we’re using government money more efficiently, we’re targeting people who really need it, and we’re saving $35 billion a year.”

The enrollment decline marks a significant reversal for the ACA marketplace, which had seen substantial growth in recent years. From 2021 to 2025, enrollment more than doubled from approximately 12 million to over 24 million people, driven largely by enhanced tax credits that made coverage more affordable. Current enrollment stands at about 22.8 million, the first year-over-year decrease in the past four years at this point in the enrollment period.

According to the nonprofit health research organization KFF, the expiration of enhanced subsidies means annual premium costs will more than double for the average ACA enrollee who previously benefited from them. This dramatic increase is forcing many Americans to make difficult choices about their healthcare coverage.

“I’m pretty much going to be going without health insurance unless they do something,” said Felicia Persaud, a 52-year-old Florida entrepreneur who dropped coverage after learning her monthly premium would increase by approximately $200. “It’s sort of like playing poker and hoping the chips fall and try the best that you can.”

The enrollment decline comes amid a contentious political battle in Washington over the future of these subsidies. Democrats have advocated for a straightforward extension of the tax credits, while Republicans have pushed for broader reforms they argue would reduce fraud and control overall healthcare costs.

In a notable development last week, the House of Representatives passed legislation to extend the subsidies for three years, despite opposition from Republican leadership. The bill now awaits Senate consideration, where pressure is mounting for a bipartisan compromise solution.

The Congressional Budget Office has estimated that extending the subsidies for three years would increase the nation’s deficit by approximately $80.6 billion over the next decade—a significant fiscal consideration that has fueled Republican resistance.

Health economists note that while some consumers who abandon ACA plans may find alternative coverage options—such as joining a partner’s employer health plan or qualifying for Medicaid—many will likely go without insurance temporarily or permanently. Some Americans interviewed have indicated they plan to pay out-of-pocket for necessary medical appointments while hoping to avoid costly injuries or serious diagnoses.

The ACA marketplace has been a crucial insurance option for millions of Americans who don’t receive health coverage through employers, including small business owners, gig workers, farmers, and ranchers. The current decline in enrollment raises significant concerns about potential increases in the uninsured rate and the associated public health implications as the year progresses.

As the political debate continues in Washington, millions of Americans are left navigating difficult healthcare decisions in an increasingly uncertain insurance landscape.