ACA marketplace enrollment fell 13% this year. HHS says most of the drop was overdue
A new administration analysis estimates 2.9 million people were removed from ACA exchange plans as improperly or fraudulently enrolled — and that 2.6 million more remain.
Enrollment in Affordable Care Act marketplace plans dropped from 22.1 million people in February 2025 to an estimated 19.2 million in February 2026 — a decline of roughly 13% [s1]. That is the headline number in a new issue brief from the Department of Health and Human Services' Office of the Assistant Secretary for Planning and Evaluation, published 26 June [s1].
What makes the brief notable is not the decline itself but the explanation its authors offer for it. Rather than attributing the drop primarily to the expiration of enhanced premium tax credits at the end of 2025 — the explanation this publication has previously reported was expected to drive coverage losses — the report's five CMS and HHS-affiliated authors frame the decline as substantially the result of the government successfully removing enrollees it says should never have been counted in the first place [s1].
The administration's case
The brief's central claim is that ACA exchange enrollment grew from roughly 10 million people annually before the pandemic to a peak of 22.1 million in February 2025 partly because temporary subsidy expansions and relaxed verification rules created what the authors call "improper, phantom, and fraudulent" enrollment [s1]. They define phantom enrollees as people signed up without their knowledge — often by commission-earning brokers — and improper enrollees as people who misstated income to access zero-premium plans [s1].
By the report's estimate, this category of enrollment peaked at 5.6 million people in 2025 [s1]. Over the following year, the administration says its program-integrity efforts — under the 2025 Marketplace Integrity and Affordability Rule — removed or blocked about 2.9 million of those enrollments: roughly 1.5 million people found ineligible for subsidies they were receiving, and another 1.4 million removed or blocked by measures such as ending year-round enrollment for people between 100% and 150% of the federal poverty level [s1]. The brief states that approximately 2.6 million potentially improper or phantom enrollments remain, including more than 1 million enrollments made without a Social Security number on file [s1].
As evidence of continued abuse, the authors point to several patterns: a jump in the share of zero-premium enrollees reporting zero medical claims (reaching 40% among the lowest-income group in 2024, versus under 25% for enrollees who pay even a modest premium); an estimated rise in the share of auto-re-enrolled, newly-premium-owing customers who fail to pay and lose coverage (from a historical average of 18% to about 50–55% in 2024–2026); and a shift among low-income enrollees away from silver plans toward zero-premium bronze and gold plans after CMS restricted access to $0 silver plans, which the authors interpret as brokers moving enrollees to avoid detection [s1].
What the brief is — and what it is not
This is worth stating plainly: the issue brief is an administration policy document, not an independent audit. Its authors are the CMS official who directs the office overseeing ACA exchange regulation, the CMS chief economist, a CMS policy advisor, an ASPE economist, and HHS's chief economist and chief regulatory officer [s1]. The brief's own methodology section describes its fraud estimates as inferred from indirect signals — principally, spikes in enrollees who file no medical claims — rather than from audited case-by-case verification of enrollee status [s1]. The authors acknowledge, in a footnote, an alternative explanation for the same data pattern (that low-income enrollees became genuinely healthier after 2021) and call it "less plausible" without ruling it out [s1].
The brief also states that some of the Marketplace Integrity and Affordability Rule's provisions were stayed by the U.S. District Court for the District of Maryland, which it says limited the administration's ability to remove additional enrollees it considers improper [s1]. That detail matters for reading the 2.6-million-remaining figure: it is presented as a number the administration says it could reduce further if not for an active legal constraint, not as an estimate independent of ongoing litigation.
What the brief does not address
The report does not estimate how many of the 2.9 million people it counts as "removed" were, in fact, eligible for coverage and lost it in error — a possibility the brief's own data cannot rule out, since it identifies suspected improper enrollment through indirect statistical signals rather than individual eligibility redeterminations. It also does not address the effect of the enhanced premium tax credits' expiration on enrollment decisions among people the brief does not dispute were legitimately enrolled, a factor this publication reported in December was expected to substantially raise what remaining enrollees pay out of pocket.
What to watch
Whether CMS publishes case-level verification data — rather than the indirect statistical signals in this brief — to support the scale of its fraud estimates. Whether the stayed provisions of the Marketplace Integrity and Affordability Rule are resolved in litigation, which would determine whether the administration's stated 300,000-person additional removal proceeds. And whether independent analyses of the same February 2026 enrollment data reach similar conclusions about how much of the 13% decline reflects fraud removal versus other factors, including affordability.
This article is informational and does not constitute advice about individual insurance coverage decisions.
Sources
- [s1] Nelson, P., Malani, A., Colleran, J., Volkov, E., Mulligan, C., "ACA Exchange Enrollment in 2026," Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services, 26 June 2026. https://www.aspe.hhs.gov/sites/default/files/documents/f5f29954221d5b5713070ac2541fda8e/aca-enrollment-report-2026-final-version.pdf
Sources
- ACA Exchange Enrollment in 2026 — Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services , June 26, 2026
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