Health insurance coverage under Covered California was terminated for almost 27,000 San Joaquin Valley residents over the first three months of 2026, mirroring a nationwide trend triggered in large part by big increases in the cost of monthly premiums.
The terminations come in the wake of the expiration of expanded COVID-era tax credits that helped middle-income families pay for their health insurance premiums under Covered California – California’s incarnation of the Affordable Care Act insurance exchange.
Those credits were cut off at the end of 2025 after the Republican-controlled Congress allowed them to lapse. Statewide, the number of terminations in the first quarter of 2025 was about 278,600.
The enhanced subsidies were enacted in 2021 during the COVID-19 pandemic to increase the affordability of the health plans for middle-income members – those whose incomes came in at 400% or more of the federal poverty level. The inability of Democrats and Republicans in Congress to agree to extend the availability of the subsidies was one of the key factors in a protracted shutdown of the federal government last fall.
For a family of four, the federal poverty level for 2026 is income of $33,000 or less per year.
The impact of the expiration of the credits was compounded by rate increases imposed by health insurance companies that took effect in January. The result: many people either chose to cancel their coverage because of the increased cost, or were unable to afford the higher monthly premiums and had their coverage terminated.
The number of terminations reported by Covered California in the San Joaquin Valley from January through March represents a 31% increase over the first three months of 2025.
Over the same three-month period of 2026, new coverage “effectuations” of health insurance under Covered California were down by about 30% compared to 2025. If a person enrolls in a health plan and pays their initial premium, their coverage becomes effective – an effectuation.
If they enroll but fail to pay their premium, however, the coverage does not take effect. Coverage can also be terminated later on for nonpayment of premiums.
Almost 2 million California residents purchased health insurance through Covered California in 2025. The vast majority of those are people whose employers don’t provide health coverage to employees, self-employed business owners, freelance “gig economy” workers and people who make too much money to qualify for Medi-Cal, the state’s incarnation of the federal Medicaid program for low-income residents.
Under Covered California, people can purchase health insurance at different levels of coverage from an array of companies.
What the Valley is experiencing in enrollments and terminations aligns with similar national ACA enrollment trends, according to KFF. an independent health policy and news organization.
“New federal data released [on June 26] shows ACA Marketplace Enrollment dropped 13% following the expiration of enhanced premium tax credits at the beginning of this year,” reported Cynthia Cox, a KFF senior vice president and director of KFF’s Program on the Affordable Care Act. “Enrollment fell from a high of 22.1 million people (nationwide) in 2025 to 19.2 million people in February 2026.”
“While the Trump administration attributes this drop enrollment to their attempts to address fraud, this coverage loss happened at the same time millions of people faced steep increases in their premium payments – often in the double or even triple digits – with the expiration of enhanced tax credits,” Cox wrote.
The federal Department of Health and Human Services reported that ACA exchanges “experienced unprecedented enrollment growth from 2021 to 2024, nearly half of which was suspected to be improper, phantom or fraudulent.”
HHS reported that the administration’s 2025 Marketplace and Integrity and Affordability Rule sought to strengthen income verification and took other steps to reduce potentially fraudulent or improper enrollment. While the June 2026 HHS analysis discussed the effects of rooting out fraud on lower ACA enrollment, it did not address the impact of higher premiums and greater out-of-pocket costs associated with the expiration of the enhanced tax credits.
To minimize the effects of the lost subsidy, California adopted its own limited subsidy program.
“With Congress failing to pass an extension of the Enhanced Premium Tax Credits for 2026, we knew consumers above certain income levels would be losing all subsidy assistance and thus likely to drop coverage this year,” said Jessica Altman, Covered California’s executive director, in a written statement provided last week to the Central Valley Journalism Collaborative.
“The data shows us that now, as cancellation rates more than doubled for middle income consumers who lost all eligibility for tax credits in 2026, rising to 24.3% in 2026 from 11.9% in 2025,” Altman said.
California’s subsidy program was aimed at lower-income customers – those with incomes between 150% and 165% of the federal poverty level.
“The latest data from the federal government shows ACA marketplace enrollment nationally is down over 13%, while in California – because of the state subsidy program – enrollment declined by 6.3%,” Altman said.
Earlier this year, an analysis by the the Public Policy Institute of California estimated that the average annual premium for low-income Covered California enrollees in the San Joaquin Valley increased by between $385 in Merced County to almost $1,200 in Kings County.
For middle-income Covered California enrollees, the PPIC analysis estimated the increase in annual premiums ranged from more than $5,200 per person in Fresno County to more than $10,000 per person in Merced County.
During open enrollment that continued through February, as the affordability of insurance premiums declined with the expiration of the enhanced tax credits, a marked shift took place statewide among new enrollees, as well as renewing members, who are selecting health plans that come with lower monthly premiums, but higher deductibles.
Tim Sheehan is the Health Care Reporting Fellow at the nonprofit Central Valley Journalism Collaborative. The fellowship is supported by a grant from the Fresno State Institute for Media and Public Trust. Contact Sheehan at tim@cvlocaljournalism.org.