Key Takeaways
Roughly 14 percent of people who signed up for Affordable Care Act plans this year failed to make their first payment after premium costs rose sharply, a new analysis found.
“It’s a big drop,” said Michelle Anderson, a consulting actuary at Wakely Consulting Group, which conducted the analysis provided to The Wall Street Journal.
The rate of non-payment is significantly higher than the typical mid-single-digit range seen in previous years. The analysis, which covered about 80 percent of the national ACA market, found that in some states a quarter or more of enrollees failed to pay. Blue Cross Blue Shield of Arizona, for instance, reported losing more than 30 percent of its initial 2026 members due to non-payment, compared with just two percent last year.
The trend points to a sicker and more expensive group of people remaining insured, which could pressure insurer profits and lead to further rate hikes. Wakely projects that overall ACA enrollment for 2026 is likely to fall between 17 percent and 26 percent from the prior year.
The exodus follows the expiration of expanded federal subsidies that began during the pandemic. Many policyholders saw their insurance bills increase substantially as insurers were also implementing major rate hikes due to rising health costs.
The Wakely data showed that enrollees who dropped their plans were about 10 percent healthier, based on estimated healthcare costs, than those who kept their coverage. When healthier people leave the market, insurers must raise premiums to cover the higher average costs of the remaining sicker pool. “It is simply because the cost of health insurance is more than what they can afford,” said Pam Kehaly, chief executive of Blue Cross Blue Shield of Arizona.
Individuals are feeling the impact directly. Sarah Smith, a 53-year-old in Ohio, dropped her family's plan after the monthly cost jumped from about $150 to $700. Sharon Dunham, 63, in Michigan, gave up her coverage when the bill rose to nearly $980 a month. “It is definitely terrifying,” she said.
The higher drop-off rate signals potential revenue headwinds and deteriorating medical loss ratios for insurers with significant exposure to the ACA marketplace. Investors will be watching the upcoming first-quarter earnings reports from major carriers like Centene, Molina Healthcare, and Elevance Health for the full financial impact.
This article is for informational purposes only and does not constitute investment advice.
