People who buy health insurance through the Affordable Care Act (ACA) marketplace could see a significant jump in their premiums next year, according to a new report. If those projections hold, it would be the biggest increase since 2018, when policy uncertainty also drove rates higher.
The preliminary rate filings from 312 insurers across all 50 states and the District of Columbia point to a mix of cost pressures behind the hikes, estimated at an average of 18% across all jurisdictions, according to the analysis by the Peterson Center on Healthcare and Kaiser Family Foundation.
Here’s a look at what’s driving the hikes and how they could affect you.
Impact of subsidy changes
A major factor is the scheduled expiration of enhanced premium tax credits at the end of 2025. These extra subsidies were first enacted in 2021 during the COVID-19 pandemic and have helped millions of marketplace enrollees, particularly those with low incomes, afford coverage. For the lowest earners, the credits have brought monthly premiums down to zero or $1 in some cases.
Without congressional action to extend the enhanced credits, out-of-pocket premiums for subsidized marketplace enrollees will increase by more than 75% on average in 2026. In 12 states, premiums could at least double.
Insurers expect that the loss of subsidies will cause some healthier customers to drop their coverage, leaving a pool of enrollees who on average have higher health care costs. That could push premiums up even more for those who remain in future years.
Why rates are climbing
Beyond the subsidy issue, insurers point to several trends driving 2026 rate increases:
Medical cost growth — Many insurers report annual increases of around 8% to 10% in the cost of hospital stays, physician visits and other services.
High-cost drugs — Demand for GLP-1 drugs such as Ozempic and Wegovy, along with other specialty medications and new gene therapies, is raising pharmacy spending.
Labor shortages — Health care providers continue to face higher staffing costs, which are passed along in payment rates negotiated with insurers.
Inflation — The overall rise in prices is adding to both medical and administrative expenses.
Potential tariffs — While the impact is uncertain, some insurers are factoring in possible cost increases for pharmaceuticals and medical supplies.
What this means for you
If you buy coverage on the ACA marketplace, plan shopping will be critical. We can help you compare options during open enrollment to find the best combination of benefits and cost. Switching metal tiers or insurers could help reduce the impact of the hike.
Also, you’ll want to make sure your reported income for 2026 is accurate since premium tax credits are based on this figure.
