Source: The Wall Street Journal
One in seven people who signed up for Affordable Care Act plans this year failed to pay after premium costs rose sharply, according to an analysis that provides the first comprehensive look at the impact of expiring federal subsidies.
Nationally, around 14% of those who enrolled in ACA plans this year didn’t pay their first monthly bill for January coverage. In some states, the share was a quarter or more, according to a new analysis from the actuarial firm Wakely Consulting Group, provided exclusively to The Wall Street Journal.
“It’s a big drop,” said Michelle Anderson, a Wakely consulting actuary.
Normally, the rate of falloff in ACA plan membership early in the year is in the midsingle-digit range.
ACA enrollment was already declining. Sign-ups fell to 23 million in 2026, from a peak of more than 24 million last year. This new data shows that millions more are at risk of losing ACA insurance. Some enrollees have a grace period, allowing them to retain their plans for three months even if they don’t make a payment.
The ACA market is a crucial business for some insurers, and politically sensitive because voters have focused on healthcare costs as a major source of financial pain. Democrats are expected to highlight the issue in this year’s midterm elections.
Many ACA policyholders saw their insurance bills mushroom after expanded federal subsidies that started during the pandemic lapsed at the start of January, when insurers were already implementing major rate hikes largely because of rising health costs.
Sarah Smith, a 53-year-old office manager who lives in Lima, Ohio, relinquished the ACA plan that covered her and her 20-year-old son, Andrew, because the cost jumped to about $700 a month this year after she lost her federal subsidy, compared with about $150 a month last year. Smith couldn’t afford to pay insurance bills that were higher than her rent.
Instead, Smith, who is healthy, bought a cheaper short-term medical plan that doesn’t cover pre-existing health conditions or mental health services, among other gaps. Smith is nervous that it won’t pay out if she needs something costly like a hospital stay. She is also worried about her son, who is uninsured.
“I try not to think about it,” she said. “Knock on wood, hope that he’s OK, I’m OK.”
When health-insurance prices rise, younger, healthier people are more likely to drop coverage, leaving a greater proportion of sicker people who are costlier for insurers.
Among people who signed up with the same ACA insurers in 2026 that they had last year, Wakely data showed that those who made their initial premium payments were about 10% less healthy, based on an estimate of their expected healthcare costs, than those who didn’t pay their January bills.
When healthier people leave a market, insurers project higher average healthcare costs per enrollee and raise their premiums to cover them. That happened this year, when insurers made steep rate increases, but it couldn’t yet be determined if they correctly gauged the pattern—or if they will raise premiums again next year partly as a result of the ever-costlier pool of enrollees.
The data in the Wakely analysis was drawn from insurers representing about 80% of national ACA enrollment across 30 states, including plans sold outside the official marketplaces. The data extended to the end of January. Wakely is owned by Health Management Associates, a research and consulting firm. The analysis doesn’t specify which states or insurers are included.
The ACA picture varied by state. In at least a few states, nearly everyone who signed up paid their first premium bills, according to Wakely’s data. States that use the federal online marketplace HealthCare.gov rather than offering their own saw higher average rates of nonpayment. There were also larger drop-offs in states where a high proportion of people were automatically re-enrolled in their plans.
Chia Yi Chin, a consulting actuary at Wakely, said some of the HealthCare.gov states saw rapid growth of low-income enrollees after the introduction of enhanced subsidies in 2021, with many on plans that didn’t require any premium payments. That expansion might now be melting away.
Blue Cross Blue Shield of Arizona said that as of the end of March, it has lost more than 30% of the members who initially signed up for 2026 ACA plans, nearly all because they made no payments before the end of the grace period. Last year, the insurer lost only about 2% of its enrollees for nonpayment at the end of the grace period.
“It is simply because the cost of health insurance is more than what they can afford,” Chief Executive Pam Kehaly said. The nonprofit’s ACA plans were in the red for the past two years, and it increased premium rates substantially in 2026 based on higher predicted costs.
The Wakely actuaries projected that overall ACA enrollment in 2026 is likely to sink by between 17% and 26%, compared with last year.
Sharon Dunham, 63, who twice survived cancer and has health conditions including irritable bowel syndrome, opted to go without insurance this year when she learned that the monthly bill for her ACA plan would grow to about $980, after losing the subsidy that held her payments to about $614 a month in 2025.
Dunham, who lives in Grand Rapids, Mich., is trying to save money and pay out of pocket for needed tests and doctor visits until she turns 65 and gets Medicare. “It is definitely terrifying,” particularly the thought that her cancer might recur, she said. “There’s the very real possibility that I can’t do anything if it shows up,” she added.
