Millions of Americans have dropped their Affordable Care Act coverage this year, and major insurers are heading for the exits, a market correction that state officials, analysts, and insurance companies attribute directly to the expiration of enhanced premium subsidies that Congress declined to renew.

Preliminary data from the Centers for Medicare and Medicaid Services, released earlier this year, showed total ACA enrollment for 2026 fell to roughly 23 million people, a decline of more than one million enrollees. But that number may only be the beginning. Insurers and analysts told The Hill that enrollment could fall by as much as a quarter before the year is out, as provisions of the One Big Beautiful Bill Act and potential Trump administration regulatory changes take effect.

The Blue Cross Blue Shield Association reported that marketplace enrollment across ACA plans is down approximately 17 percent since January 2025, with declines exceeding 30 percent in several markets. That is not a rounding error. It is a structural repricing of a marketplace that, for years, was propped up by taxpayer-funded subsidies that masked the true cost of coverage.

State-by-state fallout: California, Idaho, and Maine

California, the nation's largest state-run exchange, saw 374,000 people cancel their plans this year, compared with 240,000 last year. Jessica Altman, executive director of Covered California, framed the gap in blunt terms:

"There's no other explanation for such a delta between what is normal and what we've experienced... there's no question people are being priced out of the marketplace right now."

Idaho, which starts and ends its open enrollment window two weeks before any other state, offers an early read on the trend. Pat Kelly, executive director of Your Health Idaho, said roughly 25,000 people have dropped coverage this year, with about 5,000 of those disenrollments occurring during open enrollment itself.

Kelly, however, struck a more measured tone than his California counterpart:

"So, while we did see affordability concerns really permeate the purchase decisions all through open enrollment, we are past what we believe is the bulk of the disenrollments... we'll continue to monitor it, but we're feeling pretty comfortable about where we're at."

In Maine, former Obama administration health adviser Jeanne Lambrew, who also served as a top health official in that state, noted that 60 percent of ACA enrollees are now in high-deductible bronze plans. That shift tells its own story: consumers who remain in the marketplace are choosing the cheapest option available, trading lower premiums for higher out-of-pocket costs.

As Maine's political landscape heats up ahead of Sen. Susan Collins's reelection fight, health care affordability is certain to figure in the conversation.

Insurers pull back

The enrollment decline is only half the picture. Insurers are also voting with their feet. CVS Health's Aetna stopped offering ACA marketplace plans this year. Cigna Group announced it will exit the marketplace next year.

Lambrew connected the dots between insurer departures and market health:

"I think it's safe to say that when insurers who care about their stock value and their profits begin to leave a market, there's something wrong with that market."

An analysis from Oliver Wyman found that enrollment on HealthCare.gov, the federal exchange, dropped by nearly 8 percent compared with final 2025 enrollment. State-based exchanges, by contrast, grew by 2 percent. New consumer enrollment fell by 14 percent, while returning enrollees declined by 3 percent.

That divergence matters. State-run exchanges often have more robust outreach and enrollment infrastructure. The federal marketplace, which serves the majority of states, is absorbing the steeper losses.

How the subsidies died

The enhanced premium tax credits, first enacted during the pandemic and extended multiple times, expired at the start of this year after a prolonged political fight. Democrats shut down the government for a record 45 days last year in an attempt to force an extension. They failed. Republicans promised Democrats a vote on a bill of their choosing to extend the subsidies, but the vote did not succeed, and the credits lapsed.

That outcome reflected a basic policy disagreement. Republicans viewed the enhanced subsidies as temporary pandemic-era spending that had outlived its purpose and inflated enrollment with consumers who, in some cases, were paying little or nothing for coverage. The Trump administration and Paragon Health have argued that much of the enrollment decline represents a drop in fraudulent or improper enrollments, not genuine coverage loss.

Democrats, predictably, have cast the expiration as a crisis. With November's midterm elections approaching, health costs will likely become a central campaign issue. That political dynamic echoes broader institutional battles where both parties are positioning for maximum leverage heading into 2027.

A smaller market, or a more honest one?

Sabrina Corlette, co-director of the Center on Health Insurance Reforms at Georgetown University, acknowledged the contraction but cautioned that the full picture has not yet emerged:

"The dust has yet to settle in terms of what the expiration of the enhanced [premium tax credits] will mean for the marketplace. But it's incontrovertible that it has resulted, and is likely to result in, a smaller and sicker market."

Corlette also pointed to the instability that insurers face when the policy ground keeps shifting:

"Insurance companies like stability... this is definitely a market that's going to be in flux, in terms of the policies that are being thrown at it, in terms of affecting prices, affecting enrollment."

Lambrew offered a more tempered forecast, suggesting the marketplace will survive even if it shrinks. She also urged skepticism toward first-quarter insurer financial results, noting that companies tend to build price buffers into premiums during periods of uncertainty.

"Will the marketplace be as affordable and as accessible with as many choices? No. Will it collapse? I think the answer is probably no."

That assessment, from an Obama-era adviser, no less, is worth noting. Even critics of the subsidy expiration are not predicting a death spiral. They are predicting a market that is smaller, less generous, and more expensive for those who remain. In other words, a market that reflects its actual costs.

The comparison to 2017 is instructive. That year, political uncertainty about the ACA's future, rising premiums, and plan exits raised fears of "insurance deserts", counties with no marketplace insurer at all. Those fears proved overblown. The market stabilized, though at higher prices and with fewer options in some areas.

Congressional Republicans are now navigating a similar dynamic, with ambitious spending priorities competing for attention even as health care costs rise. Whether the party can sustain its position through the midterms depends on whether voters see the subsidy expiration as fiscal discipline or as a premium hike they did not ask for.

The real question

The enhanced subsidies were never meant to be permanent. They were pandemic relief, extended repeatedly through political horse-trading. They drove ACA enrollment to record highs, but they also cost taxpayers tens of billions of dollars annually and attracted enrollees who, by the Trump administration's account, included a meaningful share of fraudulent or improper sign-ups.

Now that the subsidies are gone, the marketplace is repricing itself. Some people are leaving. Some are downgrading to cheaper plans. Some insurers are pulling out. None of that is pleasant, but it is what happens when an artificial price floor is removed.

The honest debate is not whether the market is shrinking, it plainly is. The debate is whether the pre-expiration enrollment levels were real in the first place, or whether they were the product of subsidies so generous that they papered over fraud, discouraged price sensitivity, and created a marketplace that could not sustain itself without permanent federal life support.

Democrats will spend the next eighteen months arguing that Republicans took health insurance away from millions. Republicans will counter that they ended a temporary subsidy and cleaned up a marketplace riddled with improper enrollments. Voters will decide which story they believe.

A market built on subsidies it cannot survive without was never as healthy as its enrollment numbers suggested.