Affordable Care Act Subsidies Expire, Triggering Premium Increases for Covered California Enrollees
As the clock struck midnight marking the expiration of certain Affordable Care Act (ACA) subsidies, thousands of Californians who rely on Covered California for health insurance face potential premium hikesâsome seeing their monthly payments more than double. This significant policy shift comes amid lingering uncertainty in Washington and could notably impact the state’s health coverage landscape in 2026. A Surge in Premium Costs
According to the Kaiser Family Foundation (KFF), the expiration of enhanced federal tax creditsâcritical components of the ACA designed to lower insurance costsâmay cause average premiums to rise by approximately 114% nationwide. Those nearing retirement or with higher incomes stand to be hit hardest by the increase.
Covered California, the state’s ACA marketplace connecting more than 1.9 million people without employer coverage to health plans, reports that for many consumers, particularly middle-income families, these premium increases could amount to hundreds of dollars extra per month. For example, an illustrative family of three saw their monthly premium climb from about $350 in 2025 to $750 heading into 2026. State Response: $190 Million in Support
In response to the federal subsidy expiration, California has earmarked $190 million for the 2026 coverage year to help offset some of the cost burdens on enrollees. This funding aims to maintain monthly premiums comparable to 2025 levels for individuals earning up to $23,475 annually, or families of four making up to $48,225 per year.
Nearly 92% of Covered California enrollees currently receive some form of financial assistance, with nearly half paying $10 or less per month on their insurance. Approximately 25% could maintain a Silver-level plan at the same cost in 2026, while 17% of renewing members may pay zero premiums if they select the same plan.
However, Executive Director Jessica Altman cautions that these state funds, while helpful, will not fully bridge the gap left by the cessation of enhanced federal credits. She warns that up to 400,000 Californians could become uninsured as a result of rising premiums. âThere are people who are going to see these prices and say, âI can’t afford this, and I feel like I have no choice but to roll the dice and go without coverage,ââ Altman said, highlighting the potential personal and public health consequences.
Guidance for Consumers
Covered California stresses the importance of consumers reviewing their individual situations carefully. Executive Director Altman encourages enrollees to speak directly with enrollment specialists who can help identify plan options that might be more affordable, even if they come with higher deductibles or different coverage benefits.
Enrollment Deadlines Approaching
The open enrollment period for 2026 coverage runs through January 31, but to guarantee January 1 coverage, plans must be selected by December 31, 2025. Californians are urged to act quickly to secure coverage ahead of the looming deadline.
Looking Ahead Amid Federal Uncertainty
This policy change also occurs against the backdrop of continued federal budget negotiations. The recent government shutdown ended just weeks ago, but temporary funding only extends through January, raising fears of additional disruptions that could further complicate health insurance availability.
For more information and assistance, Covered California recommends visiting CoveredCA.com or contacting licensed enrollment professionals to explore available options.
â Reported by Lee Anne Denyer, KCRA 3 News