New data reveals that more individuals than previously estimated have canceled their Affordable Care Act (ACA) health insurance plans as we head into 2026. Released recently, the information shows that around five million people who signed up for plans through the ACA Marketplace have lost their coverage due to disenrollment or failure to pay premiums. This spike in dropouts coincides with rising market prices, which intensified last year after the Trump administration and congressional Republicans did not extend additional financial support for enrollees. The Health and Human Services Department has published this report on their website.
The figure of five million aligns with what insurers and health policy experts predicted earlier this year. Initial enrollment figures indicated a decrease of one million compared to the previous year, and stakeholders forewarned that circumstances would likely worsen as people often reconsidered their coverage due to affordability issues.
Cynthia Cox, Director at KFF’s Program on ACA, emphasized that overall enrollment has dropped by 13% from the prior year. While the Trump administration attributes this decline to efforts to combat fraud, she notes that millions are now facing significant premium increases following the expiration of enhanced tax credits. The claim of large-scale fraud contributing to this trend is a narrative held by the Paragon Health Institute, a think tank affiliated with the Trump administration.
However, many experts dispute this perspective. They highlight that enrollment numbers surged during the pandemic due to substantial federal investment aimed at making insurance more accessible—a move that enhanced premium tax credits. Cox stated, “During the period of enhanced subsidies, the market doubled in size because coverage was much more affordable and more attractive to people.”
This year’s decline in enrollment was expected, particularly since average premiums have doubled from 2025. These rising costs emerged after Republicans allowed the enhanced tax credits to lapse, with Democrats attempting to negotiate these extensions amidst government shutdown discussions in late 2025.
“When costs went up, a lot of people dropped their insurance,” Cox mentioned. She also noted that while fraud is indeed a concern, she doesn’t foresee the ACA market losing five million enrollees. Similarly, Stacey Pogue, a senior fellow at the Georgetown Center for Health Care Reform, shared her skepticism regarding the fraud allegations, reinforcing that financial decisions fundamentally influence people’s insurance choices.
This situation continues to burden consumers in an economy struggling with inflation. As Congress permitted insurance prices to rise, individuals were forced to make difficult financial decisions affecting various aspects of their lives.
This trend poses challenges for insurance companies too; some, like Cigna, have opted out of the ACA marketplace for the upcoming year. Cox warned that with fewer customers, the ACA market may become less appealing for insurers. A concerning aspect is that those dropping coverage tend to be healthier individuals, which could spiral into a market downturn, commonly referred to as a “death spiral.” Yet, Cox remains optimistic, believing sufficient participation will keep the marketplaces functional.
Nevertheless, the likelihood of rising premiums persists, posing substantial challenges for consumers burdened by escalating medical costs. The number of individuals using the marketplace may further decrease, with early 2027 premium filings indicating that rates are expected to surge once again next year.
