What is the projected impact of not extending ACA subsidies on enrollment?
Executive summary
If enhanced ACA premium tax credits are not extended, independent analyses project sharp premium increases and measurable enrollment losses: KFF estimates average marketplace premiums paid would more than double in 2026, and models from the Urban Institute/Commonwealth predict millions could lose coverage and become uninsured [1] [2]. Early federal enrollment data and state reports show a smaller but significant initial drop of roughly 1–1.4 million plan selections, with varying projections depending on methodology and timing [3] [4].
1. Rapid premium shock, then enrollment attrition
Analysts agree the immediate mechanism by which subsidy expiration reduces enrollment is higher out‑of‑pocket premium costs — KFF calculates subsidized enrollees’ average premium payments would jump 114%, from $888 in 2025 to $1,904 in 2026 if enhanced credits lapse, a rise that many low‑ and middle‑income households cannot absorb [1]. That premium “shock” is expected to push people off marketplace plans: insurer filings and health system trackers anticipated declines in enrollment because higher post‑subsidy premiums will deter or force cancellations by cost‑sensitive consumers [5].
2. Magnitude disagreement: millions uninsured in some models, smaller drops in observed selections
There is no consensus on the exact scale: Urban Institute and Commonwealth Fund modeling suggests as many as 7.3 million could lose ACA coverage with roughly 4.8 million becoming uninsured in 2026—estimates that incorporate behavioral responses and downstream effects on providers and employment [2]. Other reporting and later CMS selection counts show a more modest early decline — about 1.2 million fewer plan selections year‑over‑year and commentators noting a roughly 1.4 million decrease — suggesting real‑time enrollment dynamics, special enrollment periods, and state mitigation can blunt some modeled losses [3] [4].
3. Who is hit hardest: subsidy cliff and income sensitivity
The pain will be uneven: most marketplace enrollees receive subsidies, so about 92% are exposed to loss of enhancements, and those near the historic 400% federal poverty line “subsidy cliff” risk seeing abrupt loss of assistance and steep bill increases [6] [7]. Older adults and people with higher health needs are particularly vulnerable to adverse selection pressures if healthier enrollees drop coverage, which in turn can further increase premiums for remaining enrollees [8] [5].
4. Market and systemic ripple effects beyond raw headcounts
Researchers warn that enrollment declines would cascade into broader market effects: reduced federal subsidies would lower insurer revenues for marketplace business, potentially destabilizing provider reimbursements and hospital finances and even leading to regional plan exits or job losses; one analysis projects hundreds of thousands of jobs could be affected through those economic channels [2] [8]. The CBO likewise flags reduced federal expenditures tied to fewer subsidized enrollees if enhanced credits lapse, an outcome advocates and opponents both cite depending on fiscal or access priorities [9].
5. Mitigations, political fights, and state patchworks
States and Congress are active parts of the story: several states have moved to partially replace lost federal subsidies for some residents, while the House has voted to renew subsidies though prospects in the Senate remain uncertain — policy responses will materially change enrollment outcomes if enacted and implemented in time [10] [11]. Observed enrollment drops may understate later effects because reprogramming marketplaces and communicating changes takes time, and late legislative action would create operational and informational frictions that influence whether people re‑enroll [2].
6. Bottom line and uncertainty
The projected impact of not extending enhanced ACA subsidies is clear in direction — substantially higher premiums for subsidized enrollees and meaningful declines in marketplace enrollment with millions at risk of becoming uninsured — but not exact in magnitude, with robust model estimates ranging from about 1–7 million fewer enrollees depending on assumptions and early administrative data showing a smaller near‑term decline of roughly 1–1.4 million [1] [2] [3] [4]. Future policy moves, state interventions, and behavioral responses (return to employer coverage, Medicaid churn, or special enrollment) will determine whether the worst projections materialize or are mitigated [5] [10].