News that CVS Health’s Aetna is pulling out of the individual health insurance business, also known as Obamacare, could mean more insurers will follow if President Trump and his fellow Republicans in Congress cut health benefits.
CVS’ decision, announced last week, leaves about 1 million people in 17 states looking for new coverage in 2026. That’s a fraction of the more than 24 million Americans who signed up for such coverage on the Affordable Care Act (ACA) exchanges last fall.
But Republicans and the Trump White House are making moves to make it difficult on health insurers to sell Obamacare. The Trump administration, via the Centers for Medicare & Medicaid Services, earlier this year slashed what the federal government spends on navigators that help people sign up for Obamacare coverage.
If the cuts to navigators lead to fewer signing up for coverage, that hurts health insurers. Some of the biggest players in Obamacare, including Centene and Oscar Health, UnitedHealth Group’s UnitedHealthcare and many operators of Blue Cross and Blue Shield plans such as Elevance Health have seen record growth in their individual coverage business in recent years.
Obamacare has come a long way with millions of Americans gaining such coverage in part due to expanding subsidies that allow more people to afford health insurance. The subsidies were enhanced thanks to moves by the Biden administration and the Democratic-controlled Congress, which passed the Inflation Reduction Act of 2022, allowing more Americans to buy coverage.
Earlier this year, before Trump took office, then CMS Administrator Chiquita Brooks-LaSure attributed the record-breaking enrollment “to the importance of the enhanced financial assistance available through 2025.”
“This additional help has made all the difference for people seeking affordable insurance,” Brooks-LaSure said in January. “For example, a young professional just starting out making $30,000 a year would have previously been expected to contribute around $165 per month but can now pay no more than $50 per month, with even cheaper plans available. Just a little extra help can mean less financial stress for millions of enrollees across the country.”
Whether such momentum and growth continues after this year is uncertain. When Trump was in office from 2017 to 2021, he and Republicans in Congress tried and failed several times to repeal the ACA, the signature legislative achievement of former President Barack Obama.
So when the enhanced subsidies expire at the end of this year, Trump and Republicans in Congress may be unwilling to spend the money if they need the revenue to make up for tax cuts.
“Much of the enrollment growth stems from the enhanced premium aid first made available in 2021 that helped to make marketplace coverage more affordable for many people,” a KFF report earlier this year said. “The extra assistance is set to expire at the end of this year unless Congress acts to extend it.”
So far, none of Aetna’s rivals have hinted at plans to exit Obamacare or pull back from markets where the currently sell plans.
But industry analysts say they are watching and they expect – at the very least – that more insurers will retreat to fewer states and counties.
“Don’t be surprised if this isn’t the last announcement by an ACA carrier that they’re bailing on the exchange market entirely (or at least reducing their footprint of where they offer coverage) over the next few months,” Charles Gaba who founded ACASignups.net, a website that tracks Affordable Care Act data and other health topics wrote on his site last week after the CVS announcement. “Their actuaries are crunching the numbers right now to figure out what plans they plan on offering next year at what premium levels, and the likely expiration of the (Inflation Reduction Act) subsidies on New Year’s Eve is likely going to lead to millions of enrollees being priced out of the market.”
