Teladoc Membership to Decline as ACA Subsidies Expire | Healthcare Dive

Berlin – Teladoc Health, a leading telehealth provider, is bracing for a decline in membership within its integrated care business in 2026, a shift partially attributed to the expiration of enhanced Affordable Care Act (ACA) subsidies. The company announced this projection during its fourth-quarter earnings call on Wednesday, signaling a potential ripple effect from changes in healthcare affordability and access. This development comes as Teladoc navigates a strategic transition focused on international expansion, operational efficiency and a move towards visit-based revenue models.

The anticipated decrease in U.S. Integrated care members is expected to fall between 97 million and 100 million in 2026, down from the 101.8 million members at the close of the previous year, according to the company’s recent earnings report. Teladoc Health’s official statement attributes this decline, in part, to reduced enrollment within client health plans participating in government programs, directly impacted by the finish of more generous financial assistance for ACA coverage. The lapse of these subsidies, which helped lower premiums and out-of-pocket costs for many Americans, is now expected to affect healthcare utilization patterns and membership numbers.

The Impact of Subsidy Lapses and Shifting Revenue Models

The expiration of enhanced ACA subsidies, initially implemented to mitigate the financial burden of health insurance during the COVID-19 pandemic, has been a subject of ongoing debate. These subsidies were extended through 2025, but their absence in 2026 is projected to increase premiums for many individuals and families, potentially leading them to forgo coverage or opt for lower-cost plans with limited benefits. This, in turn, is expected to affect telehealth providers like Teladoc, which rely on insured members for a significant portion of their revenue. According to a report by the Kaiser Family Foundation, approximately 13.7 million people were at risk of losing financial assistance when the enhanced subsidies expired. KFF’s analysis details the potential impact on enrollment and affordability.

Beyond the subsidy issue, Teladoc is actively shifting its focus from a subscription-based revenue model to one centered on per-visit fees, particularly within its integrated care segment. This strategic move includes a new service offering virtual care for a broader range of medical conditions, available 24 hours a day, seven days a week. Teladoc’s announcement highlights the company’s commitment to expanding access to convenient and comprehensive care. However, CEO Chuck Divita acknowledged that even as visit revenue is experiencing strong growth, it hasn’t yet fully offset the decline in subscription revenue. This transition presents both opportunities and challenges, as analysts express concerns about the volatility associated with a visit-based model.

Analyst Concerns and Financial Performance

The shift to a visit-based revenue model has prompted some skepticism from financial analysts. Michael Cherny, an analyst at Leerink Partners, expressed hesitation regarding the “ongoing model uncertainty” as Teladoc transitions from a stable, fee-based subscription system to a more variable visit-based approach. Cherny noted that this uncertainty is compounded by the membership declines linked to the expiration of ACA subsidies. The analyst’s concerns were outlined in a Wednesday note, reflecting a cautious outlook on Teladoc’s financial performance.

Despite these challenges, Teladoc reported positive growth in certain areas. In 2025, membership in integrated care programs increased by 9%, while revenue from these programs rose by 3% to $1.6 billion. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also saw a 3% increase, reaching $239.2 million. However, enrollment in chronic care management programs experienced a 1% decline. Looking ahead to 2026, Teladoc anticipates revenue growth in the integrated care segment to range between 0.4% and 3.9%.

BetterHelp’s Challenges and Insurance Acceptance

Teladoc’s mental health business, BetterHelp, continues to face headwinds despite efforts to improve its financial performance. While the company has made progress in accepting insurance coverage – now available in 20 states plus Washington, D.C. – BetterHelp’s revenue fell by 9% year-over-year in 2025, reaching $950.4 million. Adjusted EBITDA also declined significantly, dropping by 46% to $41.9 million. The number of average paying users in the mental health segment decreased by 5% during the same period. BetterHelp generated $13 million in revenue from insurance in 2025, and the company projects this figure to rise to between $75 million and $90 million in 2026, according to Divita’s statements during the earnings call.

Divita attributed the challenges faced by BetterHelp to a combination of factors, including a challenging consumer landscape and the company’s strategic decision to reduce advertising spending while prioritizing the expansion of its insurance offerings. He suggested that continued headwinds are likely among consumers paying cash for services. The company’s efforts to secure insurance coverage are seen as a key factor in improving investor sentiment, according to Ryan Daniels, an analyst at William Blair.

Overall Financial Performance and Future Outlook

In 2025, Teladoc reported total revenue of $2.53 billion, a decrease of approximately 2% compared to the previous year. The company also posted a net loss of $200.3 million, a significant improvement from the $1 billion loss recorded in 2024. For 2026, Teladoc projects revenue to fall between $2.47 billion and $2.59 billion, while anticipating a net loss per share between $1.10 and $0.70. These projections reflect the ongoing challenges and strategic shifts facing the telehealth provider as it navigates a changing healthcare landscape.

Key Takeaways

• ACA Subsidy Impact: The expiration of enhanced ACA subsidies is expected to contribute to a decline in Teladoc’s integrated care membership.
• Revenue Model Shift: Teladoc is transitioning from a subscription-based to a visit-based revenue model, which presents both opportunities and risks.
• BetterHelp Challenges: Teladoc’s mental health business, BetterHelp, continues to face financial headwinds despite efforts to expand insurance acceptance.
• Financial Performance: Teladoc reported a decrease in overall revenue in 2025 but a reduced net loss compared to the previous year.

The telehealth market remains dynamic, and Teladoc’s ability to adapt to evolving consumer needs and regulatory changes will be crucial for its long-term success. The company’s focus on international expansion, operational efficiency, and strategic partnerships will likely play a key role in shaping its future trajectory. Investors and healthcare stakeholders will be closely watching Teladoc’s progress as it navigates these challenges and opportunities in the coming months. The next major update on Teladoc’s performance is expected during the first-quarter earnings call in May 2026.

What are your thoughts on the future of telehealth and the impact of policy changes on access to care? Share your comments below, and please share this article with your network.