Obamacare Premiums Jump 114% Overnight — Why 4.8 Million Americans May Drop Coverage in 2026

Enhanced tax credits that helped lower the cost of health insurance for the majority of Affordable Care Act (ACA) enrollees expired overnight as 2026 began, cementing significantly higher costs for millions of American families who now face impossible choices.

On average, more than 20 million subsidised enrollees are experiencing a 114% increase in their premiums this year, according to an analysis by healthcare research non-profit KFF. The change impacts a diverse cross-section of Americans who do not receive employer-sponsored coverage and do not qualify for Medicaid or Medicare, including self-employed workers, small business owners, farmers, and ranchers, according to PBS.

A separate analysis conducted last September by the Urban Institute and Commonwealth Fund projected that these higher premiums could lead approximately 4.8 million Americans to drop coverage altogether in 2026, according to CBS News.

What This Means for Your Wallet

For families already stretched thin, these figures are staggering.

Katelin Provost, a 37-year-old single mother and social worker, watched her monthly premium leap from $85 (£62.70) to nearly $750 (£553.27), according to PBS.

'It really bothers me that the middle class has moved from a squeeze to a full suffocation, and they continue to just pile on and leave it up to us,' Provost said. 'I'm incredibly disappointed that there hasn't been more action.'

Others are facing similarly brutal hikes. Kylie Barrios, a 30-year-old Florida resident and small business owner, told CBS News her family's premium is effectively tripling from approximately $900 (£664) to $2,500 (£1,844.25) per month.

The impact could be greatest in Florida, which has the largest number of ACA enrollees of any state—more than 4.7 million, according to KFF data cited by CBS News. Texas follows with over 3.9 million enrollees.

Stan Clawson, a 49-year-old freelance filmmaker and adjunct professor living with paralysis from a spinal cord injury in Salt Lake City, saw his premiums jump from roughly $350 (£258.19) to nearly $500 (£369) monthly. He has absorbed the increase because he cannot risk going without coverage.

How We Got Here

The expired subsidies were first introduced in 2021 as a temporary measure to aid Americans through the COVID-19 pandemic. Democrats in power at the time extended them, pushing the expiry date to the start of 2026.

Under the expanded programme, some lower-income enrollees received healthcare with zero premiums, while higher earners paid no more than 8.5% of their income, according to PBS. Middle-class eligibility was also widened.

Democrats forced a 43-day government shutdown over the issue, CBS News reported. Moderate Republicans called for a solution to protect their 2026 midterm prospects. President Donald Trump floated a compromise, only to retreat after conservative backlash.

Ultimately, none of these efforts were enough to preserve the subsidies before the expiry date.

Could Congress Still Act?

A House vote expected later this month could present another opportunity, but success remains far from assured, according to PBS.

In December, the Senate rejected two partisan healthcare bills. Democrats proposed extending the subsidies for three years, while Republicans offered an alternative centred on health savings accounts. Both failed.

Four centrist House Republicans broke ranks with GOP leadership and joined forces with Democrats to push for a vote on a three-year extension of the tax credits, CBS reported. However, with the Senate having already rejected such a plan, it remains uncertain whether it could gain enough momentum to pass.

The open enrolment window runs until 15 January in most states, so the final impact on coverage numbers remains uncertain.

What Happens Next

Health analysts predict that the withdrawal of subsidies will prompt many of the 24 million total ACA enrollees—particularly younger and healthier individuals—to forgo insurance altogether. Over time, this could increase costs for the remaining, often older and sicker, population.

Provost expressed hope that Congress might revive the subsidies early in the year. If not, she plans to drop her own coverage and keep insurance only for her four-year-old daughter, as she cannot afford both at current prices, CBS reported.

'Both Republicans and Democrats have been saying for years, oh, we need to fix it. Then do it,' said Chad Bruns, a 58-year-old ACA enrollee from Wisconsin. 'They need to get to the root cause, and no political party ever does that.'

For millions of Americans, the new year has arrived with an unwelcome bill and a painful choice: coverage or groceries?