ACA market disruption after subsidy cliff
Key Questions
How has ACA enrollment changed since the subsidy cliff?
Enhanced premium tax credits expired January 1, 2026, leading to a 3 million (13%) drop in enrollment. Early signs point to adverse selection in the remaining risk pool.
What premium increases are insurers requesting for 2027?
Insurers have requested an average 14% premium increase, the second-highest in nearly a decade. The hikes are driven by a sicker enrollee mix following subsidy expiration.
What risks does the market face from the subsidy changes?
4.8 million people are at risk of coverage disruptions. The shift represents a structural change that could trigger a sustained adverse selection spiral in the individual market.
Enhanced premium tax credits expired Jan 1, 2026. Enrollment dropped 3M (13%) in 2026. New: Insurers request 14% premium increase for 2027, second-highest in nearly a decade, driven by sicker enrollees and subsidy expiration. 4.8M at risk. Early signals of adverse selection spiral. This is a structural shift in the individual market with real consequences for coverage and premiums.