San Diego Covered California new enrollments fall as enhanced federal premium tax credits expire for 2026
A slowdown in new sign-ups amid uncertainty about monthly costs
New Covered California enrollments have declined in San Diego County during the 2026 open enrollment season as the federal “enhanced” premium tax credits—temporary subsidies that lowered monthly premiums for many households—reached their scheduled expiration at the end of 2025. The enhanced subsidies were first implemented in 2021 and broadened financial help to many middle-income consumers while increasing assistance for those already eligible.
Across California, Covered California reported a significant year-over-year drop in new sign-ups during the early portion of the open enrollment period for 2026 coverage, a downturn that aligns with uncertainty over whether Congress would extend the enhanced subsidies before the December 31, 2025 deadline.
Why the expiring subsidies matter for San Diego shoppers
For consumers buying individual-market insurance through Covered California, the enhanced tax credits reduced what many households paid each month by limiting the share of income expected to go toward a benchmark plan. If those enhanced credits are not extended, assistance for some middle-income households can shrink sharply—or disappear entirely—reviving the “subsidy cliff” for people above 400% of the federal poverty level.
Those dynamics are especially relevant in high-cost regions where full-price premiums are higher. San Diego County includes many self-employed residents, early retirees, and “gig” workers who rely on the marketplace because they do not receive employer-sponsored coverage.
What state leaders have put in place for 2026
California moved to cushion the impact for the lowest-income marketplace enrollees by budgeting state funds intended to help keep premiums closer to 2025 levels for consumers at the lowest income tiers. However, state funding is designed as a partial backstop and does not replicate the scale of federal support that had been flowing to Californians each year through the enhanced credits.
What consumers should know during open enrollment
Timing: Open enrollment for 2026 coverage runs through January 31, 2026. Enrolling by December 31, 2025 was the key deadline for coverage starting January 1, 2026.
Renewals vs. new enrollments: Overall enrollment can remain high even when “new” sign-ups slow, because many existing members renew coverage.
Plan shopping: Premiums and financial assistance can change year to year; consumers are generally able to compare carriers and metal tiers to manage monthly costs and out-of-pocket exposure.
The end of the enhanced federal subsidies creates a narrow window in which households must reassess whether coverage remains affordable, particularly those who previously qualified for larger credits or newly gained eligibility under the expanded rules.
What happens next
Federal action could still alter affordability in 2026 if Congress restores or replaces the enhanced premium tax credits. In the meantime, San Diego County’s enrollment trend is being closely watched as an early indicator of how subsidy changes may affect coverage decisions in a region with significant health care costs and a large population that shops on its own for insurance.
Covered California continues to maintain a statewide marketplace with multiple participating insurers for 2026, while some carrier participation changes are also taking effect.