Companies offering Affordable Care Act (ACA) marketplace health plans are seeking a median 14% premium increase for 2027, according to an analysis released Wednesday by the Peterson-KFF Health System Tracker.
If approved by state regulators, it would mark the second-highest annual premium increase since 2018.
The Affordable Care Act, commonly known as Obamacare, provides government-subsidized health insurance for Americans who do not receive coverage through an employer. Insurers submit proposed premium rates to state regulators each year ahead of the next coverage period.
Rising Medical Costs Push Premiums Higher
According to Peterson-KFF, rising healthcare costs remain the biggest driver of the proposed rate increases. Insurers cited higher spending on medical care, increased demand for specialty medications and GLP-1 weight-loss drugs, as well as broader medical inflation.
The analysis also found that insurers expect the pool of enrollees to become older and sicker after the expiration of enhanced federal premium subsidies introduced during the COVID-19 pandemic. As healthier consumers continue dropping coverage, insurers estimate that shift alone will add about 4 percentage points to next year’s premium increases.
Some insurers also said recent Trump administration policy changes that tighten enrollment requirements are contributing to higher requested rates. In its New York filing, UnitedHealth Group Inc. (NYSE:UNH) said the combination of expiring enhanced subsidies and the new enrollment rules accounted for 12.7% of its proposed rate increase.
Affordability Pressures Continue
The Department of Health and Human Services estimates 19.2 million Americans are currently enrolled in ACA marketplace plans, down about 13% from 22.1 million in 2025 after the enhanced subsidies expired.
Without those additional subsidies, average premiums rose 58% in 2026, while deductibles increased by roughly $1,000 per person, making coverage less affordable for many consumers. If the latest filings are approved, ACA premiums will have risen by more than 33% between 2025 and 2027.
Most marketplace enrollees earning less than 400% of the federal poverty level continue to qualify for premium subsidies, helping shield them from much of the increase. Those with incomes above that threshold, however, are likely to bear the full impact of higher premiums.
Marketplace Faces Policy Changes
The proposed rate requests build on earlier warnings that higher healthcare costs would continue to pressure the ACA marketplace. In May, KFF projected marketplace enrollment would decline after enhanced federal subsidies expired, warning that rising premiums would push more consumers to drop coverage while increasing financial pressure on insurers.
The filings also come as the Trump administration tightens oversight of the Affordable Care Act marketplace. Earlier this week, Health and Human Services Secretary Robert F. Kennedy Jr. and Centers for Medicare & Medicaid Services Administrator Dr. Mehmet Oz said more than 1 million HealthCare.gov enrollees do not have a Social Security number on file as part of a broader review of suspected fraud and enrollment verification. Administration officials have also said nearly 2.9 million improper or questionable enrollments have already been removed or blocked.
Insurers, including Centene Corporation (NYSE:CNC) and UnitedHealth Group Inc. (NYSE:UNH) have also warned investors about elevated medical costs in their Affordable Care Act businesses this year. CVS Health Corporation (NYSE:CVS) said last year that its Aetna unit would stop offering Obamacare plans in 2026 because of rising costs.
Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.
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