Why ACA enrollment has fallen by millions

Enrollment in the Affordable Care Act marketplace has fallen by millions of people this year — and the Trump administration and health policy experts are at odds over the cause.

The number of people enrolled in a health insurance plan bought on the ACA marketplace declined by roughly 3 million people — or, about 13% — to 19.2 million in February 2026 from 22.1 million at the end of 2025, according to data issued last week by the Department of Health and Human Services.

It was the first drop in ACA enrollment since the first Trump administration, and the largest decline since the ACA marketplaces were established in 2014.

The data provided the first look at “effectuated” enrollment since the lapse of enhanced ACA premium subsidies at the end of 2025, which reduced the cost of enrollees’ monthly premiums. The data accounts for whether people who enrolled were also able to make monthly payments.

Health policy experts said the drop-off is the clearest sign yet that the lapse of federal subsidies for ACA premiums is making insurance too expensive for many Americans, leading many households to drop their coverage.

The Trump administration described the decline in a positive way: HHS pointed to its efforts to crack down on fraud as a major driver of the recent falloff.

Its efforts have partially unwound a large increase in fraudulent enrollment that occurred during the Biden administration, HHS said in its recent data release. Among other things, the agency noted that the Centers for Medicare & Medicaid Services canceled coverage for 250,000 people enrolled in an ACA plan without their consent.

Policy experts said there’s little evidence to support the notion of a fraud clampdown being the primary factor.

Instead, the fraud argument provides political cover for the administration and for Republicans in a midterm election year, at a time when affordability is “Americans’ preeminent concern,” said Jonathan Oberlander, a professor of health politics and policy at the University of North Carolina at Chapel Hill.

Enhanced ACA premium subsidies were a key reason for the government shutdown in the fall: Democrats pushed to extend the subsidies beyond 2025, but the GOP ultimately allowed them to expire.

The GOP also made a number of administrative tweaks to the ACA marketplace in their so-called big beautiful bill, which estimates suggest will further reduce enrollment.

“Republicans, under President Trump are working to deliver health care affordability across the board,” a spokesperson for the Centers for Medicare & Medicaid Services said in an e-mailed statement. “Further, CMS will continue to root out waste, fraud, and abuse wherever it is found to protect Americans’ tax dollars,” the spokesperson said.

“The Trump Administration has utilized numerous tools mobilizing a full-scale effort to ensure federal subsidies are going only to those for whom they are intended,” according to the report issued June 26 by the Office of the Assistant Secretary for Planning and Evaluation, within HHS.

Health policy experts don’t dispute that there has been a degree of measurable alleged fraud in the system. Indeed, the Government Accountability Office — a nonpartisan federal watchdog that audits government spending and efficiencies — outlined the risk of fraud tied to ACA subsidies in a December report requested by congressional Republicans.

But experts do dispute the cause, as some of the problematic activity can be explained by legitimate or non-criminal factors, they said.

HHS said it estimates more than 1 million current ACA enrollees don’t have a Social Security number, which it categorizes as “improper” or “phantom” enrollments. But experts said this isn’t clear evidence of wrongdoing.

For one, many lawfully present immigrants in the U.S. with legitimate visas who are allowed to receive ACA coverage wouldn’t necessarily have a Social Security number, said Michael Gusmano, a professor of health policy at Lehigh University.

Immigrants in the country illegally had already been barred from enrolling in an ACA plan, he said.

More broadly, there can also be data-matching issues with Social Security numbers in ACA marketplace enrollment — meaning the lack of SSN may be a data issue, not misconduct, Oberlander said.

The lack of SSN could arise if brokers try to sign up “fake” enrollees — which would be fraudulent — but could also happen if a broker is simply “sloppy” and chooses not to bother collecting all an enrollee’s information, said Matthew Fiedler, a senior fellow at The Brookings Institution, a think tank, who studies healthcare economics and policy.

“Indeed, the reason that the Administration has not simply terminated these enrollments en masse may very well be that they believe this group includes many legitimate enrollments,” Fiedler wrote in an e-mail.

Oberlander was even more direct in his assessment, suggesting the terminations were politically motivated. “The enrollment drop is absolutely not about fraud,” he said. “[Republicans] are exaggerating the scope of the fraud issue to obscure the cuts they have pursued in health insurance coverage.”

HHS said in its recent report that many enrollees were misstating their income in order to access these “free” ACA health plans.

However, this alleged misstatement may not have been intentional, said Cynthia Cox, director of the ACA program at KFF, a nonpartisan health policy research group.

When people sign up for ACA coverage, they must estimate their income for the coming year. These estimates determine their eligibility for premium subsidies — and some people, especially those with volatile incomes, may guess wrong, Cox said.

At any rate, they must reconcile that income on their tax returns and pay back excess subsidies.

The “free” plans also offered a financial incentive for “unscrupulous” brokers to sign up people for ACA coverage without their knowledge, in order to receive a commission, according to HHS. Because they didn’t owe a premium payment, such people didn’t know they were enrolled.

CMS identified and canceled coverage for 250,000 people who were enrolled without consent, HHS said.

Enrollees faced an average increase of 114% in their premiums — to $1,904 in 2026 from $888 in 2025 — due to the subsidy lapse, according to KFF estimates last year. Certain enrollees faced the prospect of paying an additional $20,000 or more in annual premiums in 2026, KFF said.

“It’s basic economics that making something more expensive makes people less likely to buy it,” Fiedler, of The Brookings Institution, wrote in an e-mail.

“There is also abundant empirical evidence that when premiums go up, many fewer people buy coverage (especially in the low-income population that the Marketplaces serve),” he wrote. “So if doubling enrollees’ premiums did not result in a big enrollment decline, that would be a major surprise.”

Additionally, inflation in the U.S. economy remains high, Gusmano said.

That has caused a decline in household earnings after accounting for the cost of living — making it harder to afford health premiums, he said.

Policy changes to the ACA marketplace that the Trump administration highlighted “had most of their effect before the end of 2025,” meaning the big enrollment declines seen in early 2026 can’t be readily explained by fraud controls, Fiedler said.

It’s likely that enrollment will continue to fall throughout 2026, and in future years, too, experts said.

About 17% of returning ACA enrollees said they weren’t confident they could afford their monthly health insurance premium for the entirety of 2026, according to a KFF poll published in March.

The Congressional Budget Office estimated in February that total enrollment in ACA marketplace health plans will fall to 12.5 million by 2028 — nearly half of last year’s enrollment. That would still exceed enrollment in 2021, when enhanced subsidies took effect, by about 1 million people.

The share of the U.S. population without health insurance is expected to swell from 7.6% in 2025 to 10.4% by the end of the decade, according to the CBO.

“It’s a major erosion of enrollment in the marketplace — and we’re only in the first months [of 2026],” said Oberlander, of the University of North Carolina. “This is just the beginning.”