Leave room in your budget for sharp increases in health care premiums.
Whether you have an employer-based plan or receive coverage through the Affordable Care Act marketplace, the monthly cost of having health insurance is on track to rise sharply in 2026.
For starters, healthcare costs are quite high. This year, family premiums for employer-sponsored health plans reached an annual average of nearly $27,000, up 6% from the previous year, and workers paid an average of $6,850 of that total, according to a survey by the nonprofit health policy organization KFF. (Most Americans receive health coverage through their employers.)
Now, employers say they expect the total cost of health benefits per worker to rise by the most in 15 years, according to Mercer, while some Americans with marketplace plans are getting notices that their costs will rise sharply if the enhanced tax credits eventually expire.
Health care costs are rising for a multitude of reasons, Sara Collins, senior researcher at the Commonwealth Fund, told Yahoo Finance.
Growth in medical costs, driven by changes in prices for services, prescription drugs, and increased health care utilization, typically leads insurers to set higher premiums. And employers have reported higher costs due to larger catastrophic claims, more spending on chronic illnesses and workers using weight-loss medications.
When it comes to higher premiums, “some employers may just absorb all of that cost and just keep asking employees to keep contributing the same amount,” Collins said. “But people are likely to see, if not higher premiums, some changes to their cost-sharing in particular, perhaps higher co-pays for doctor visits and prescription drugs.”
Meanwhile, for next year, the average premium increase proposed by insurers for plans regulated by the Affordable Care Act is 18%, the largest one-year increase proposed since 2018.
More than 24 million Americans received their health insurance through the Affordable Care Act marketplace this year, and open enrollment for next year begins Nov. 1. A major factor behind the current government shutdown — the second-longest in U.S. history — is that enhanced Biden-era premium subsidies for those plans are set to expire, meaning millions of Americans may receive less help to cope with higher costs next year.
More information: Medicare Open Enrollment: How to Adjust Your Coverage
“Throughout October, consumers are informed of these higher net premiums because they will face higher net out-of-pocket costs without the enhanced subsidies,” said Fredric Blavin, senior researcher in the Urban Institute’s Health Policy Division. “This will impact consumers right now in terms of their winter plan purchases or their re-enrollment.”