By Stacey Pogue and Karen Davenport
Health care affordability repeatedly ranks at or near the top of Americans’ financial concerns – in a recent poll for POLITICO, for example, health care costs ranked third among respondents’ affordability worries, following only food and housing. Consumers’ spending on health care premiums and out-of-pocket costs represents an important and growing share of family budgets, and almost half of American households do not have enough cash-on-hand to cover a typical employer plan deductible should they experience a health care crisis.
Congressional inaction has only sharpened this dilemma for the individuals and families who purchase their health insurance through the Affordable Care Act (ACA) Marketplaces. The vast majority of Marketplace enrollees purchase coverage with the help of federal premium tax credits (PTCs), which offset much of the cost of coverage. From 2021 to 2025, Congress improved the value of and expanded eligibility for these tax credits, which meant that many enrollees could purchase a Marketplace plan and pay no premium themselves, while other enrollees—often older enrollees or those who live in high-cost areas—qualified for PTCs for the first time. However, these “enhanced” PTCs, or ePTCs, expired at the end of 2025, which means that Marketplace enrollees face much higher premiums for their 2026 plans. On average, out-of-pocket premiums for Marketplace enrollees have increased by 114 percent compared to the 2025 plan year, with some enrollees facing even higher increases in their net premium to maintain their health insurance coverage. This means that many consumers faced untenable choices during open enrollment, such as deciding to go without health insurance—in spite of known health problems—or dipping into retirement savings to pay their health insurance premiums. Some experts predict that the expiration of ePTCs, in combination with other changes to Marketplace coverage enacted in 2025, will result in 4.8 million more people going without health coverage in 2026.
Some of these consumers originally turned to Marketplace coverage because, as small business owners, entrepreneurs, farmers, freelancers, gig economy workers, or part-time workers, they do not receive health coverage through a large employer. Others may work for an employer who offers health coverage but does not pay a large enough share of the premium to make this coverage affordable. Early data on open enrollment from the federal government provides only a dim glimpse of how these consumers are responding to increased net premiums for Marketplace coverage, while data from states throws somewhat more light on this question.
First Federal Data Release Inconclusive
In mid-January, the Centers for Medicare & Medicaid Services (CMS) released a “snapshot” of the 2026 open enrollment period which shows that 22.8 million people had selected a plan or been automatically renewed in Marketplace coverage.* At first blush, these numbers may seem surprisingly robust given the steep premium increases facing many consumers. While 834,000 fewer people have selected a plan than at this time last year, this 3.5% decrease in plan selections does not approach the enrollment declines expected in the wake of ePTCs’ expiration.
This federal snapshot, however, only takes us to the middle of the story and does not reflect all the data needed to tell a complete tale. We will have to wait until summer, if not later, for a fuller picture of 2026 paid enrollment (released last year in July). By that point, the federal data should reflect several dynamics that the current snapshot does not capture, including:
- Final enrollment choices by people who were auto-renewed into 2026 plans. These enrollees would have received an invoice for their first 2026 premium, reflecting reduced PTC amounts and therefore higher premiums for the 2026 plan year, in mid- to late-December. They would then need to decide whether they could pay the higher premium, switch to a cheaper plan, or go uninsured.
- Final enrollment choices for people who affirmatively shopped during Open Enrollment and chose a plan. These shoppers could have either completed enrollment by paying their January 2026 premium, or they could have chosen not to pay this first premium and therefore failed to complete enrollment. Some of these shoppers may have chosen a plan in the hope that Congress and the Trump Administration would reach an agreement on extending the ePTCs—and when this did not happen before the end of Open Enrollment, they could not afford to keep their coverage.
- Movement between coverage levels for returning enrollees. With smaller PTCs to offset plan premiums, individuals and families may choose to enroll in a lower-cost but also lower-value plan. For example, while the weighted average of ACA plan deductibles in 2026 across all metal levels is nearly $3,000 for an individual, the average deductible for a bronze plan is almost $7,500.
More complete federal data expected in the summer will still not reveal other important dynamics, such as how many enrollees complete enrollment and pay premiums as long as they can, but ultimately drop their Marketplace plan as the higher premium leaves them without resources for other necessities.
Red Flags in Early Data from States
Twenty states and the District of Columbia run their own state-based Marketplaces (SBMs), some of which have released additional preliminary open enrollment data that help fill in some of the current story. Even in SBMs, the full impact of skyrocketing net premiums cannot be measured yet, but initial trends raise red flags about the erosion of affordability.
Cancellations are up. Several SBMs report that consumers are cancelling coverage at higher rates than in prior years. Idaho saw its number of disenrollments quadruple compared to last year, with many more consumers citing affordability concerns. Pennsylvania has also seen four times as many people cancel coverage, while Massachusetts and Virginia report that their numbers of cancellations have more than doubled compared to last year. Proactive cancellations of coverage do not include consumers who select a plan or who were auto-renewed for 2026, but who ultimately do not pay their premium.
More consumers are expected to drop coverage in the coming months. Open enrollment data released to date are of people who have selected a plan, but enrollment is not complete and coverage does not actually take effect until they pay their first month’s premium. Information on paid enrollment will not be available for several months, and is expected to show a decline, possibly meaningfully, from the number of plan selections. Early data from Pennsylvania hints at the expected trend. In December, the Pennsylvania SBM reported that only 77% of enrollees had paid their initial premium, compared to 88% at the same point in the prior year.
Consumers are moving to plans with higher out-of-pocket costs. SBM consumers are migrating to plans with higher deductibles and other out-of-pocket costs—such as moving from gold or silver plans down to bronze plans—as consumers try to lower their monthly premiums. To date, California is seeing a higher share of new consumers enroll in bronze plans (37% in 2026, compared with 23% in 2025) as well as more people who actively renew coverage switching to to bronze plans (23% in 2026, compared with 6% in 2025). Other SBMs that report a migration to bronze plans include Idaho, Maine, New Jersey, and Rhode Island. High out-of-pocket costs in bronze plans expose enrollees to more financial risk and medical debt.
Middle-income consumers are hard hit. Middle-income consumers (with incomes over 400% of the federal poverty level or $107,000/ year for a family of three), face much higher net premiums in 2026 due to the “subsidy cliff” that roared back when ePTCs expired. In California, while overall enrollment held almost steady as of January 17, enrollment of middle-income consumers hit hardest by the subsidy cliff (at 400-600% of the federal poverty level) dropped 63%. In Massachusetts, the average net premium for middle-income consumers (400-500% of the federal poverty level) went from $319/month in 2025 to more than $580/month in 2026, due to the loss of financial help.
Looking Ahead
More thorough SBM data provides a window into the struggles many consumers face as 2026 Marketplace net premiums spiked. Early SBM experience shows more people are dropping coverage or “buying down” to plans with higher deductibles, adding to their risk of medical debt. Despite these worrying trends, the final enrollment outlook in SBMs may prove rosier than in the federal Marketplace. Some SBMs have taken extra steps to increase enrollment: with longer open enrollment periods, sustained investments in community-based enrollment assistance, and state-funded subsidies to further reduce consumers’ costs.
A handful of states increased funding for state affordability programs in 2026, to backfill a portion of the loss of ePTCs and blunt cost increases. New Mexico is the only state that backfilled all of the lost federal premium tax credits with state subsidies, including for lawfully residing immigrants under the poverty line. It reported a 17% increase in plan selections at the end of its open enrollment period, in stark contrast to the downward national trend thus far. But New Mexico’s patch is only fully funded for the first half of 2026, and state officials caution that no state can afford to make up the difference from reduced federal tax credits on an ongoing basis.
We may learn more about final plan selection counts in short order, but experts expect that paid enrollment will drop from that high watermark as consumers weigh whether to pay their January or February bill, and some of those who can’t move through a 90-day grace period before losing coverage. While the full impact of Marketplace affordability challenges will take many months to show up in enrollment data, early SBM data show warning signs that consumers are feeling squeezed and that coverage declines may continue well after open enrollment wraps up.
*Data in CMS’s January 12, 2026 snapshot are as of December 27, 2025, for state-based Marketplaces, and as of January 3, 2026, for the remaining states that participate in the federal Marketplace, HealthCare.gov.
