Instant Insight
30-Second Take
- ACA health insurance premiums could spike 75% for subsidized enrollees in 2026 if enhanced tax credits expire
- Insurers already filing 10-20% rate increases, citing expiring subsidies and rising healthcare costs
- New CMS rule aims to lower premiums but may not offset subsidy expiration impacts
+ Dive Deeper
Quick Brief
2-Minute Digest
Essential Context
The enhanced premium tax credits (ePTCs) that reduced ACA marketplace costs since 2021 are set to expire December 31, 2025. Without congressional action, most subsidized enrollees face average net premium increases exceeding 75%, while insurers project gross premium hikes of 7.9% due to deteriorating risk pools.
Core Players
- KFF – Leading health policy research organization
- CMS – Federal agency overseeing ACA marketplace
- Congress – Facing pressure to extend ePTCs
- Health insurers – Filing double-digit rate increases
Key Numbers
- 75% – Average net premium increase for subsidized enrollees
- 7.9% – Projected gross premium increase from risk pool deterioration
- 10-20% – Typical 2026 rate increase requests from insurers
- $12B – Taxpayer savings projected from new CMS rule
+ Full Analysis
Full Depth
Complete Coverage
The Catalyst
The expiration of enhanced premium tax credits threatens to destabilize ACA markets. Insurers warn that without these subsidies, healthier enrollees will drop coverage, raising costs for remaining members. Early 2026 rate filings already show 4% premium increases directly tied to the subsidy expiration.
Inside Forces
Insurers face dual pressures: rising healthcare costs and policy uncertainty. BridgeSpan of Oregon cited 4-5 percentage points of its 12.6% rate hike to subsidy expiration, while other factors like medical inflation drove the remaining increase. The new CMS “Marketplace Integrity” rule aims to combat improper enrollments but may not fully offset these pressures.
Power Dynamics
Congress remains divided on extending ePTCs. While some lawmakers propose budget reconciliation measures to mitigate premium spikes, most subsidized enrollees would still face higher costs. CMS’ rule focuses on eligibility verification but doesn’t address the core subsidy issue.
Outside Impact
Uninsured rates could rise as premiums become unaffordable. Taxpayers face $20B in potential improper enrollment costs if verification processes remain weak. States like Vermont and Oregon are already seeing proposed rate hikes exceeding 10%.
Future Forces
Key developments to watch:
- Congressional action on ePTC extension before year-end
- Final 2026 rate approvals by state regulators
- Implementation of CMS’ eligibility verification rules
- State-level responses to premium spikes
Data Points
- 2021-2025: Enhanced tax credits reduced ACA costs
- June 2025: CMS finalizes Marketplace Integrity rule
- July 2025: Insurers file 10-20% rate increases
- December 2025: ePTC expiration deadline
The convergence of expiring subsidies, rising healthcare costs, and regulatory changes creates a perfect storm for ACA markets. While CMS and Congress attempt mitigation strategies, the immediate outlook for 2026 remains dire for millions of enrollees.
