CALIFORNIA — Covered California reported 374,000 enrollee cancellations in the first quarter of 2026, representing 19% of those who had renewed coverage during open enrollment. The cancellation rate—the highest in four years—followed the expiration of enhanced federal Affordable Care Act subsidies on December 31, 2025.
Enrollment in Covered California stood at 1.8 million in February 2026, down from 1.94 million in February 2025, marking a 7% year-over-year decline. Cancellation rates in early 2026 exceeded those of the previous three years, which ranged from 13% to 15%.
Jessica Altman, executive director of Covered California, attributed the rise in cancellations to the loss of federal subsidies. “We expect coverage losses to increase through the year,” she said. Enhanced federal subsidies, first expanded by Congress in 2021, had eliminated income caps and limited premium costs to 8.5% of income for higher-earning households.
The average premium for a Covered California plan rose more than 10% in 2026 due to increasing medical costs. In response, more enrollees selected lower-priced Bronze plans, which carry higher co-pays and deductibles than costlier options. “We’re very concerned with the large shift to Bronze,” Altman said. “When you have higher cost-sharing, you’re more likely to defer care.”
California allocated $190 million in its 2026 state budget to subsidize premiums for residents with incomes up to 165% of the federal poverty level. Governor Gavin Newsom has proposed expanding that support in 2027 with $300 million in state subsidies for those earning up to 200% of the poverty level—$31,920 for an individual or $66,000 for a family of four. “We may actually see a number of Covered California enrollees paying less in 2027,” Altman said. The proposal requires approval by the California State Legislature.