Whether your health insurance coverage is part of the Affordable Care Act (ACA) or not, you can expect a hefty premium increase in 2026. For example, insurers in New York are filing premium rate increases that range from a modest 0.9 percent to a hefty 66.4 percent, according to insurance services firm Certifi.
Why do insurance premiums continue to increase? Will this force healthy individuals to forgo insurance and take their chances?
Rising Cost of Health Care
Medical inflation contributes to the increase in health insurance costs. According to the Peterson-KFF Health System Tracker, the price of medical care has increased by 121.3 percent since 2000. This includes services, drugs, and medical equipment.Factors that contribute to these costs include an aging population (which contributes to increased use), technological advances, administrative costs, profit margins, and specialty medications.
According to the Health System Tracker, overall health costs typically outpace growth in the rest of the economy.
Aging Population Contributes to Higher Premiums
In 2023, there were 56 million Americans over 65, according to the Administration for Community Living. This number is projected to swell to 94.7 million by 2060. According to the National Institute on Aging, 60 percent of these older adults have two or more chronic conditions. This adds to the strain on and cost of health care.Technological Advances Save Lives but Not Money
Better procedures that come from advanced health care technology may be better, but they also cost more. And over time, these latest technologies account for 38–62 percent of the increase in health care insurance costs.GLP-1s and Specialty Medications
There’s a growing demand for specialty medications, such as Ozempic and Wegovy. This contributes to increased prescription drug spending. For example, the standard list price for Ozempic is $997.58 per month, according to Novocare, the company that owns the patent on it.Novocare also owns Wegovy, which has a list price of $1,349.02 per month. Both GLP-1 drugs are used for diabetes treatment and weight loss.
Insurers expect script mix to increase by 7 percent in 2026.
In response to these costs, insurers are either increasing premiums or are beginning to remove coverage for GLP-1s for weight-loss purposes, resulting in a decrease in premiums.
Employers to Shift Costs to Workers
In 2026, group health plan premiums are expected to increase. The total health-benefit cost per employee is expected to rise 6.5 percent, according to Mercer. This expected increase is the highest since 2010.Many employers are planning to shift more health care costs to employees. According to the Society for Human Resource Management, 51 percent of organizations with 500 employees or more plan to shift costs, such as higher deductibles or out-of-pocket maximums, to employees. Employers cited higher health care costs that are inflating premiums.
According to Mercer, employers are doubling down on cost management and are opting for alternative medical plans that steer employees toward higher-value providers.
Affordable Care Act May Not Be Affordable
People who buy health insurance from the ACA Marketplace could receive the biggest premium increases.Enhanced premium tax credits, enacted by the Biden administration, are set to expire on Dec. 31. These credits have increased the amount of financial assistance enrollees in the ACA Marketplace receive.
According to the Health System Tracker, the credit expiration may cause premiums to increase by more than 75 percent starting in January 2026. Many healthy enrollees may leave the market, leaving the risk pool sicker on average. A larger risk pool with many unhealthy members may further increase premiums.
However, ACA Marketplace insurers are proposing a median premium increase of 18 percent in 2026. This will affect millions. As of 2025, 24 million Americans were in the ACA Marketplace, according to the Centers for Medicare & Medicaid Services.
ACA Market Out-of-Pocket Maximum Limit to Increase
According to Healthcare.gov, the out-of-pocket costs for health insurance will increase. This includes deductibles, copayments, and coinsurance for in-network care and services.You’ll continue to pay out-of-pocket for services not covered by the plan.
The out-of-pocket limit for ACA Marketplace plans varies, but you can’t go over a set amount each year. The out-of-pocket limit for 2025 is $9,200 for an individual and $18,400 for a family.
For the 2026 plan, the limit will be $10,600 for an individual and $21,200 for a family. This is on top of the increase in premiums, copayments, and coinsurance costs.
How to Prepare for Premium Increases
Regardless of whether you are in a group plan or an ACA Marketplace plan, there are several ways to help you manage higher health care costs.Understand what your deductibles, coinsurance, or out-of-pocket maximums mean. This will help you budget for high health care costs. Consider using tools such as GoodRx to compare drug prices.
Use health savings accounts (HSAs) to cover these additional expenses. Contributions to HSAs are tax-deductible, and the money grows tax-free. Withdrawals are tax-free when used for qualified medical expenses.
Suppose you have a large hospital bill; consider negotiating with the hospital for a lower rate and payment plan. Some hospitals provide financial assistance.
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