Obamacare signups dropped by 1.2 million. Here's why that may change

Millions of Americans were expected to lose Affordable Care Act health insurance when enhanced tax credits were eliminated this year.

But so far, the worst-case scenario hasn't materialized even though momentum to reinstate COVID-era subsidies has stalled.

About 23 million Americans signed up for ACA coverage on federal and state-based marketplaces in 2026, down from 24.2 million signups as of January 2025, according to Jan. 28 figures from the Centers for Medicare & Medicaid Services.

"Enrollment is not down as much as I thought it would be," said Cynthia Cox, vice president and director of the program on the ACA at KFF, a health policy nonprofit.

But the preliminary figures come with a couple of big caveats, Cox and other enrollment experts said.

Millions of Americans with ACA insurance, also known as Obamacare, were automatically reenrolled in plans that are more expensive this year and consumers' average insurance costs may spike 114% because of the expiration of the enhanced tax credits, according to a KFF analysis.

People might choose to drop coverage once they get their first monthly insurance bill. Those who are automatically reenrolled but fail to pay their insurance bills get a grace period of three months before their coverage is terminated. Those figures won't be known until later this year, Cox said.

Before the enhanced tax credits took effect in 2021, about 85% of enrollees who signed up for an ACA plan paid their premiums to maintain their insurance coverage, said Sabrina Corlette, codirector of Georgetown University's Center on Health Insurance Reforms.

Also unknown is how many people switched to higher-deductible "bronze" plans that charge a lower monthly premium. While switching to a high-deductible plan might make it more affordable to keep coverage, consumers' out-of-pocket costs can soar when they visit the doctor or hospital or fill a prescription.

The number of enrollees who paid their premiums or switched to cheaper, less robust plans "are the two big unknowns," Corlette said. She said those figures are needed "before we can draw any conclusions about what the impact of the federal policy change really means."

State aid for enrollees bolsters signups

Several states that operate their own state-based ACA insurance exchanges have sought to cushion the blow with financial aid for consumers.

New Mexico signups reached an all-time high in 2026, partly because of generous state measures that replaced the ACA's enhanced premium tax credits. A total of 82,403 state residents signed up for coverage as of mid-January, a 17% increase from 2025.

New Mexico's Health Care Affordability Fund − created in 2021 and supported by a tax on health insurers − reduces premiums and out-of-pocket costs for people on BeWell, the state's ACA marketplace. The fund also supports other health programs, and nearly half of the fund's revenue goes to New Mexico's general fund.

State assistance for ACA signups is allocated through June, but the state legislature must act to extend assistance through the year, said Abuko Estrada, health care director of the New Mexico Center on Law and Poverty.

"There's a lot of concerns from families," about potential coverage losses, Estrada said. "They are concerned that assistance could go away."

Other states offer limited assistance for residents who face higher insurance bills because of the absence of enhanced tax credits. California and Maryland extend subsidies to low-to-moderate income families, but those who earn at least four times the federal poverty level will have to pay full costs.

Maryland's one-year program replaces any lost subsidies for individuals who earn up to $31,300 per year, which is two times the federal poverty level. California's assistance is capped for individuals and families who earn up to 165% of the federal poverty level.

Colorado and Washington also have approved limited financial assistance for some ACA enrollees, according to a KFF analysis.

Is the push to extend ACA subsidies dead?

Congressional Democrats last year pushed to extend enhanced tax credits that made insurance less expensive for millions of Americans. Democrats forced a federal government shutdown for a record 43 days in late 2025 when most Republicans refused to extend the subsidies.

Without the enhanced tax credits that expired at the end of 2025, average costs for 22 million Americans who get subsidized ACA insurance more than doubled in January, according to KFF.

Some consumers said they've struggled to afford their rising expenses for ACA insurance plans. The Congressional Budget Office estimated 3.8 million Americans would lose health insurance through 2035 due to the expiration of the enhanced subsidies.

Congress passed a budget fix on Feb. 3 for most federal agencies through September to end a partial government shutdown. The budget includes health-related provisions on medical billing and drug-pricing middlemen called pharmacy benefit managers, but didn't address ACA subsidies.

On Jan. 8, the House passed legislation that would extend ACA enhanced premium tax credits for three years, but the Senate hasn't taken up the legislation. Sen. Bernie Moreno, an Ohio Republican, crafted a bipartisan compromise in the Senate, but his proposal hasn't advanced.

Moreno told Semafor on Feb. 2 that some Democrats haven't ruled out his plan to modify and extend the enhanced tax credits. "The people I'm talking to want to actually solve it," he said.

Health care advocates are urging lawmakers to continue trying to improve ACA affordability.

Anthony Wright, executive director of Families USA, which advocates for health care consumers, noted that the House's deal to end the government shutdown included provisions on health care affordability.

“Despite the inclusion of these policies, the package fails to stop the massive premium spike in the individual insurance market by not extending the enhanced premium tax credits," Wright said.

Reach Ken Alltucker at [email protected].