The expiration of the ACA’s enhanced premium tax credits appears to be playing out positively for several insurers’ profit margins, while some of the nation’s largest hospital operators are absorbing a wave of newly uninsured patients who continue to seek care.
The enhanced credits, which lowered exchange premiums for millions of enrollees, lapsed at the end of 2025 after Congress failed to extend them. Insurers had anticipated the expiration in their 2026 rate filings, raising premiums in part around the assumption that healthier members would face sticker shock and drop coverage.
“We expected some of these patients to shift to other forms of coverage, but this did not happen,” HCA Healthcare CEO Sam Hazen said on the company’s second quarter earnings call July 24. “Instead, these patients migrated almost one for one to uninsured.”
The Nashville, Tenn.-based system had originally assumed 80% to 85% of individuals dropping exchange coverage would become uninsured. Under its revised assumption, HCA raised its full-year estimate of the payer mix hit to between $1 billion and $1.2 billion, up from $600 million to $900 million in April, with roughly $400 million landing in the second quarter alone.
Similarly, Community Health Systems more than doubled its estimate of the annual EBITDA hit from the enhanced subsidy expiration when it reported second-quarter results, to between $50 million and $75 million from an initial $20 million to $30 million. Self-pay patients climbed to just over 6% of visits from slightly less than 5% a year earlier.
“We only collect a few pennies on the dollar” from self-pay patients, CHS CEO Kevin Hammons told investors July 23, adding that the Franklin, Tenn.-based system is “effectively not recognizing any revenue on that self-pay business.”
Universal Health Services, which operates both acute care and behavioral hospitals, saw the same ACA-to-uninsured pattern from a smaller exchange patient base, with a 15% drop in exchange volumes replaced almost directly by self-pay patients.
Dallas-based Tenet Healthcare was the outlier, even as exchange revenue fell 17% and admissions about 13.5%, creating a $65 million revenue headwind. The health system raised its full-year adjusted EBITDA guidance to between $4.83 billion and $5.03 billion as cost initiatives it began planning in mid-2025, along with its ambulatory surgery mix, absorbed the hit. Exchange patients overall made up only about 5.5% of the system’s consolidated revenue.
Tenet’s numbers also complicated assumptions that the fallout would hit hardest in states that have not expanded Medicaid, with the system recording its steepest declines in Florida, Arizona, Michigan, South Carolina and Texas, a mix of expansion and non-expansion states.
“These states, which are swing states, must have had a lot of members needing the support of premium tax credits in order to continue to acquire product,” Tenet Chairman and CEO Saumya Sutaria, MD, said during the system’s Q2 earnings call.
Ohio, Oklahoma and Arizona have seen the steepest year-over-year enrollment declines, each shedding roughly 30% of marketplace enrollees. Nationwide, effectuated ACA enrollment fell to 19.2 million in February, down 12% from nearly 21.8 million a year earlier. Insurers have said individuals that dropped coverage tended to be disproportionately healthier, leaving an older, sicker risk pool behind.
Centene, which refiled its 2026 rates with states last summer, saw its marketplace membership fall to about 3.5 million in the second quarter from roughly 5.9 million a year earlier, a deliberate retreat paired with pricing built around the smaller pool and expected risk-adjustment transfers. On July 28, the company raised its full-year pretax marketplace margin outlook to between 4.5% and 5%, up from 3%, as its commercial medical loss ratio improved to 79.2% in the second quarter from 90.6% a year earlier. Centene also raised its full-year adjusted EPS guidance to more than $4.80 from more than $3.40.
“Q2 adjusted diluted earnings per share of $2.51 exceeded our previous expectations, with outperformance driven by underlying business strengths and a more fully informed view of our marketplace risk adjustment positioning,” CEO Sarah London said on the company’s earnings call. “We continue to expect membership to decline as we move through the rest of the year, consistent with a return to more regular seasonality, and our guidance has accounted for membership impacts related to various ongoing CMS program integrity efforts.”
Elevance said its individual ACA business performed well in Q2, driving about half of its better-than-expected results, though executives warned part of the boost was one-time and unlikely to continue. UnitedHealthcare also said its exchange book is running ahead of expectations, though the company has pledged to return its exchange profits this year to enrollees.
Still, not every insurer has benefited from the market shakeup. Molina Healthcare cut its full-year marketplace guidance by $1.50 per share after finding that high-cost members stayed enrolled in its plans despite higher premiums. The insurer plans additional pullbacks for 2027 after previously exiting markets this year.
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