Health care premiums set to rise sharply for millions in ACA Marketplace in 2026

Health care costs are climbing, and so are premiums under the Affordable Care Act. In 2026, more than 300 insurers that offer coverage through the ACA Marketplace plan to propose an average premium increase of 18%. That’s at least 11 percentage points higher than the average hike proposed the previous year.

Rising premiums on the horizon

Insurers proposing premium changes include companies such as Blue Cross and Blue Shield, UnitedHealthcare Insurance and Celtic Insurance. Premiums are the monthly payments people make to keep their health insurance coverage.

Meanwhile, a new analysis from the Peterson-KFF Health System Tracker finds that insurers are proposing the steepest rate hikes since 2018, the last time federal policy changes triggered major uncertainty in the marketplace. The KFF analysis, based on insurer filings from 19 states and Washington, D.C., offers early insight into what’s driving next year’s proposed rates.

What’s driving higher costs?

Insurers say it’s getting more expensive to offer coverage due to the increasing use and cost of specialty drugs. Broader economic forces, such as inflation and higher labor costs in the health care sector, also add pressure.

But medical costs aren’t the only concern. Many insurers are preparing for the possible expiration of enhanced premium subsidies that were expanded during the pandemic. If those subsidies end, monthly premiums could rise by more than 75% for many enrollees.

The push to prevent those subsidies from expiring is already underway in Congress.

Lawmakers push to protect coverage affordability

U.S. Sen. Jeanne Shaheen, D-N.H., has introduced legislation that would permanently extend the enhanced premium tax credits that have helped keep ACA coverage more affordable since the pandemic. She said the goal is to lower costs and protect families from price spikes.

“At a time when Americans are already grappling with the high cost of living, these premium price hikes will devastate working families trying to make ends meet,” she said in a statement. “When Congress returns next month, it’s imperative that we have honest, good-faith discussions about extending the ACA enhanced premium tax credits that have been a lifeline for tens of millions of Americans. 

KFF notes that sharp increases could cause some healthier individuals to drop coverage altogether. That would leave a smaller, riskier insurance pool and could drive premiums even higher for those who remain.

Shaheen’s bill faces an uncertain future in the GOP-led Senate. Republicans have long sought to roll back the ACA, saying the federal subsidy for otherwise healthy, able-bodied Americans isn’t a wise use of taxpayer dollars.

Federal policies adding pressure

A newly finalized rule from the Trump administration is already contributing to higher costs. The Center on Budget and Policy Priorities (CBPP) warned on Aug. 1 that the rule would increase premiums, deductibles and other out-of-pocket expenses for many of the 23 million people who get coverage through the ACA Marketplace.

The rule lowers the value of premium tax credits, which help reduce monthly payments and give insurers more flexibility to raise what people pay when they actually use their coverage. According to CBPP, the changes are technical on paper but carry a clear impact: most enrollees could see their annual costs rise by several hundred dollars.

State spotlight: Arkansas reacts to rate hikes

Arkansas Gov. Sarah Huckabee Sanders, R, cited her state as an example, where Centene Corporation and Blue Cross Blue Shield are seeking premium increases of up to 54% and 25.5%, respectively. She said the proposed hikes are not only wrong, but also prohibited under Arkansas law.

“Arkansas’ Insurance Commissioner is required to disapprove of proposed rate increases if they are excessive or discriminatory, and these are both. I’m calling on my Commissioner to follow the law, reject these insane rate increases, and protect Arkansans,” Sanders said in a statement reacting to the increases. 

Insurers also flagged other federal policy changes, including new tariffs and updates to eligibility rules, though those played a smaller role in their pricing decisions.