ACA Subsidies Expire: Californians Face Soaring Health Insurance Costs

The expiration of enhanced federal subsidies for Affordable Care Act (ACA) plans at the end of December 2025 is leading to significant increases in health insurance premiums for many middle-class Californians, forcing some to delay medical care or forgo coverage altogether. The situation highlights the precariousness of healthcare affordability and the impact of policy changes on individual access to care.

For Mikayla Tencer, a 29-year-old content creator in San Francisco, the loss of subsidies has dramatically altered her healthcare budget. Last year, her Blue Shield plan through Covered California cost $168 per month. This year, without the enhanced federal assistance, the same plan would have cost $299 per month, accompanied by higher copays. “People assume that because I’m young, I can just pick the cheapest plan and not worry about it,” Tencer said. “But I do need regular care, especially for mental health.” To mitigate the cost, she switched to a cheaper plan, but this came with increased out-of-pocket expenses for primary care and mental health visits, rising from $35 to $60 per visit. She also discovered her psychiatrist was out of network, resulting in a $180 charge for a single appointment.

The enhanced subsidies, enacted in 2021 as a temporary measure during the COVID-19 pandemic, provided financial assistance to individuals and families earning more than 400% of the federal poverty level – roughly $62,600 for a single person and $128,600 for a family of four. With their expiration, those above this income threshold no longer qualify for federal assistance, and many still eligible are facing substantial premium increases. Covered California premiums, on average, also rose by 10.3% this year due to increasing medical costs, compounding the financial strain.

The impact extends beyond increased premiums. Krista, a 42-year-old photographer and videographer in Santa Cruz County, relies on costly intravenous treatments for a rare blood disorder. Her monthly premium jumped from approximately $285 last year to over $1,200 in late December, due to the loss of subsidies and a 23% increase in her Blue Shield premium. Faced with this financial burden, Krista has decided to move into an RV on private land to reduce her living expenses and preserve her ability to save for retirement.

The situation is not unique to those with chronic conditions. Jayme Wernicke, a 34-year-old receptionist and single mother in Chico earning around $49,000 annually, experienced a premium increase from $30 to $60 per month, then to roughly $230 after the subsidies expired. Her employer does not offer health insurance, and her current plan lacks dental and vision coverage, providing minimal medical benefits. Wernicke has decided to drop her coverage and pay for care out of pocket, calculating that the state tax penalty is less expensive than the premiums. Her daughter remains insured.

Other Californians are making similar decisions. Two residents, who requested anonymity, told The Times they had also opted to go without coverage due to affordability concerns. One, a 29-year-old self-employed publicist in Los Angeles with epilepsy, calculated that paying for medication and annual doctor visits out of pocket would be less expensive than maintaining a silver plan that had increased from $535 to $823 per month. Another, April, a 58-year-old small-business owner in San Francisco, canceled her insurance after premiums for a bronze plan rose to $1,151 per month and a silver plan to $1,723 per month, compared to $566 for both herself and her daughter the previous year. The bronze plan also carried a $3,500 deductible.

Jessica Altman, executive director of Covered California, estimates that approximately 160,000 Californians lost their subsidies when the enhanced federal assistance expired due to incomes exceeding 400% of the federal poverty level. While overall enrollment in Covered California has remained stable, Altman fears more individuals will drop coverage as they receive bills reflecting the higher premiums.

The potential consequences of widespread coverage loss are significant. Experts warn of a potential “death spiral” in the ACA market, where the departure of younger, healthier individuals leaves a disproportionately older and sicker population enrolled, driving up costs further. According to estimates from KFF, premiums more than doubled for the average subsidy recipient in 2026, rising to $1,904 per month from $888 the previous year. Approximately 22 million people receive coverage through the Affordable Care Act, and around 1.5 million Californians are covered through Covered California.

Tencer believes that universal, affordable healthcare should be a national priority. “Our government should be providing it,” she said. “People can’t go to the doctor for routine checkups, they can’t get things checked out early, and they can’t access the resources they need.” The current situation underscores the challenges of maintaining access to affordable healthcare in the face of policy changes and rising medical costs, leaving many Californians struggling to balance their health needs with their financial realities.