Soaring ACA Premiums Push 3 Million Americans to Riskier Health Plans

An estimated 3 million Americans have dropped their Affordable Care Act (ACA) health insurance plans in 2026 following sharp premium increases, forcing many to seek coverage in a less-regulated market or go without insurance, according to a Reuters report. The exodus follows the expiration of enhanced COVID-era premium tax credits, which led to significantly higher costs for consumers.

Costs Drive Marketplace Exit

The number of individuals covered by ACA marketplace plans, often called Obamacare, fell to 19.2 million as of February, according to government data. The cost pressures are expected to continue, with health policy research group KFF projecting a median premium increase of about 15% for 2027, the second consecutive year of double-digit hikes.

The rising premiums and high deductibles are forcing self-employed individuals and families to make difficult financial choices. Open enrollment for 2027 ACA plans is set to run from November 1 to January 15. Key publicly traded insurers offering ACA plans include UnitedHealth (UNH), Elevance (ELV), Centene (CNC), and Molina Healthcare (MOH).

Shift to Alternative Coverage

In response to higher costs, many former ACA enrollees are turning to other options that often provide less comprehensive coverage and fewer consumer protections. These alternatives include:

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• Short-term plans: These plans offer lower monthly premiums but typically cover only catastrophic events and are designed to fill temporary gaps in insurance.
• Health-sharing programs: Often organized by religious groups, these are not traditional insurance. Members pool monthly contributions to help pay for each other's medical bills, but they lack the regulatory oversight and guaranteed coverage of ACA-compliant plans.
• Going uninsured: A significant number of individuals have opted to forgo insurance altogether, postponing preventive care and paying out-of-pocket for urgent medical needs.

Market Impact and Consumer Risk

The shift away from comprehensive insurance is creating ripple effects across the healthcare system. Hospital operators like Universal Health Services (UHS) have reported rising costs associated with treating an increasing number of uninsured patients. For consumers, the trade-off for lower premiums often means skipping essential care, such as cancer screenings, due to coverage limitations or high out-of-pocket expenses.

Experts warn that the market for these alternative products can be difficult to navigate. Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms, described it as a "wild, wild West," urging consumers to be aware of the risks and limitations of non-traditional health plans.