Premiums for Affordable Care Act (ACA) coverage are projected to increase significantly next year, with an average hike of 26%, according to a recent analysis by KFF released just ahead of the upcoming open enrollment period starting November 1. This surge marks one of the most substantial increases since the inception of Obamacare over a decade ago and doesn’t yet account for the anticipated expiration of enhanced premium subsidies.
Consumers in the 30 states utilizing the federal exchange, healthcare.gov, can now preview their potential costs for 2026 coverage. The window shopping feature, launched on Tuesday, indicates that the average monthly premium for the benchmark plan on the federal site will see an alarming 30% rise. In states with their own exchanges, the benchmark plan premium is expected to increase by an average of 17%.
The situation is compounded by the expected disappearance of enhanced subsidies, which has led to predictions that enrollees’ actual monthly payments could more than double. This is a drastic outlook, particularly as many consumers prepare for the sticker shock associated with the loss of enhanced assistance.
Despite the foreboding figures, it should be noted that most enrollees will still find 2026 plans available on the federal exchange priced at or below $50 a month once the original Obamacare subsidies are factored in. However, a noticeable drop is evident, with nearly 60% of enrollees qualifying for this lower price range, compared to 83% of consumers in 2025.
The Biden administration has highlighted in recent years that four out of five enrollees could secure plans for $10 or less, emphasizing the importance of subsidy support to keep health insurance accessible. The current analysis has raised concerns as the Centers for Medicare and Medicaid Services (CMS) did not address the increase in premiums from insurers.
The looming expiration of enhanced subsidies has sparked contention within Congress as lawmakers work to avert a federal government shutdown. Democrats are advocating for the inclusion of these extended aids in a short-term funding package, while Republicans insist negotiations can only commence after the government reopens, drawing attention to the hefty $350 billion price tag associated with renewing subsidies over the next decade.
With the legislative debate ongoing, the pressure is building: if consumers see significant premium increases, there is a real concern that they may choose not to enroll for coverage, even if the subsidies are ultimately renewed. Historical data shows that the only larger premium increase occurred in 2018 when there was significant federal support withdrawal under the Trump administration, leading to a 37% spike in costs that year.
States administering their own exchanges have also reported concerning increases in premiums. In New Jersey, for instance, the average premium is forecasted to rise over 174% if enhanced subsidies are allowed to lapse. Approximately 60,000 residents enrolled in Get Covered New Jersey may lose federal assistance altogether in 2026. Justin Zimmerman, the state’s Commissioner of Banking and Insurance, cautioned that many consumers might resort to choosing lesser coverage or drop out entirely.
Colorado’s situation mirrors this trend, with average premiums projected to climb by 101% next year, threatening the accessibility of healthcare for approximately 75,000 residents. Families could see dramatic premium hikes, exemplified by a Denver family of four facing a potential increase in their annual premiums by $14,000 if the enhanced assistance is lost.
On a more positive note, the enhanced subsidies introduced in 2021 have been a significant driver for record enrollment figures in the ACA, boosting sign-ups to 24 million this year alone. This statistic highlights the critical role that financial assistance has played in expanding healthcare coverage. However, concerns about potential fraud tied to the subsidies eye into the complexities ahead as lawmakers navigate these policies moving forward.
As open enrollment approaches, the emphasis remains on ensuring that the coverage stays accessible and equitable while mitigating the looming impact of subsidy expiration on vulnerable populations.