News

State-based subsidies saved some ACA Marketplace losses

States that offered their own subsidies to consumers had lower ACA Marketplace enrollment losses, according to new KFF data.

Sara Heath
By
Published: 30 Jul 2026

A new report from KFF outlines effectuated Affordable Care Act Marketplace enrollment, painting what the organization says is a clearer picture of how overall ACA coverage has changed this year.

The analysis comes after previous reporting that ACA Marketplace signups dropped by about a million between 2025 and 2026. Policy experts generally attributed this decline to the lapse of enhanced premium tax credits that previously helped more low- and middle-income people afford Marketplace plans.

A closer look at effectuated enrollment adds to that story, demonstrating the full impact of the subsidy lapse and how some states were able to attenuate coverage losses.

Effectuated enrollment refers to the number of people who signed up for an ACA Marketplace plan and maintained that plan by paying the first month's premium. When enrollees don't not pay the first month's premium, they get a three-month grace period before that plan is canceled.

Effectuated enrollment offers a better look at overall ACA coverage because it accounts not just for how many Marketplace signups there were, but how many people are actually paying for the plans they selected.

In 2026, ACA Marketplace effectuated enrollment was 19.2 million, down from 21.8 million last year. That means 2.6 million fewer people have ACA coverage, either because they did not sign up for a plan or because they didn't pay their premiums and had their plans canceled.

This trend is, in large part, the result of rising premiums and consumers' share of cost.

Overall, premiums rose from $496 per month for a silver plan for a 40-year-old earning 200% of FPL to $624 per month. Consumers' share of those premiums spiked due to the lapse of enhanced premium tax credits. While that 40-year-old would've paid only $50 of that premium in 2025, they now pay $172.

Rising consumer costs led many to forgo Marketplace insurance or stop paying their premiums, effectively letting their plans lapse.

State variation in effectuated enrollment linked to state benefits

But those effects weren't felt equally across states.

Illinois saw a 0% change, meaning effectuated enrollment held steady. In Idaho, Texas, Pennsylvania, the District of Columbia, Connecticut, Massachusetts and Rhode Island, effectuated enrollment shrank by less than 5%. In New Mexico, effectuated enrollment actually rose.

Other states were hit much harder.

For example, effectuated enrollment dropped by more than 32% in Ohio and Oklahoma, and by more than a quarter in Arizona (30%), South Carolina (29%), Indiana (28%), Michigan (27%), Minnesota (27%), Mississippi (26%) and Louisiana (26%).

Certain state characteristics might have led to high effectuated enrollment losses. For example, Minnesota is unique in offering a separate Basic Health Program that covers low-income people who would otherwise enroll in the ACA Marketplace, KFF said. Minnesota also has a higher-income enrollee pool, meaning it was likely more heavily impacted by the lapse of enhanced premium tax credits.

But that's not all. KFF noted that states with their own subsidies, which were not impacted by the lapse of the enhanced premium tax credits, saw smaller effectuated enrollment losses.

For example, New Mexico has both a state-based Marketplace and a state-based subsidy, and it saw a 14% enrollment increase this year. Conversely, Ohio has no state-based subsidy, and it saw a whopping 32% drop in enrollment.

All said, of the 26 states with below-average drops in effectuated enrollment, 18 had state-based Marketplaces, and nine of those states had state-funded subsidies.

"These differences across states suggest that the availability of state-level premium assistance helped cushion the effect of expiring enhanced premium tax credits on enrollees' ability to maintain coverage, though enrollment changes likely also reflect broader differences in state populations and Marketplace administration," the report's authors said.

State subsidies boost ACA enrollment effectuation rates

The report also looked at effectuation rates, or the difference between the number of people who signed up for ACA Marketplace plans and those who'd paid the first month's premium to put the plan in place. A higher effectuation rate means that more people paid that first month's premium and kept their plan active.

Nationwide, the ACA Marketplace effectuation rate was 83% in 2026, down from 90% in 2025.

Again, this trend was not felt equally across states.

Mississippi had the lowest effectuation rate at 62%, meaning just under two-thirds of consumers who signed up for a plan maintained coverage past January. Effectuation rates were much higher in New Mexico, California, Nevada, Vermont and Idaho, reaching as high as 95%.

States with state-based Marketplaces tended to have higher effectuation rates than those on the ACA Marketplaces. Likewise, states with state-based subsidies had higher effectuation rates than others.

Ultimately, the data indicates that health plan affordability deeply affected ACA Marketplace enrollment. As the consumer share of premium costs rose, it became less likely that someone would select a plan or pay its premium, effectively losing coverage.

States have some power to attenuate this issue, the ACA authors noted.

"These patterns suggest that state policies designed to blunt the effect of rising premiums may be associated with higher rates of enrollees maintaining active coverage, though other factors -- such as income levels, Marketplace type, and state outreach efforts -- likely also play a role," they concluded. "All states that offered state subsidies to backfill some portion of the expired enhanced premium tax credits were above the median change in effectuated enrollment."

Sara Heath is an executive editor at Xtelligent Healthcare Media, where she covers patient engagement, healthcare policy and health IT.

Dig Deeper on Healthcare policy and regulation