For the second year in a row, many insurers under the Affordable Care Act are proposing double-digit premium increases, driven by rising medical costs as well as policy changes by Congress and the Trump administration.
In preliminary filings with state regulators, insurers are seeking an average rate increase of 14% by 2027, according to an analysis of filings in 16 states and the District of Columbia by Peterson-KFF Health System Tracker.
If those rates are ultimately approved, it would be the second-highest increase since 2018.
That would be a “triple whammy” for consumers, said Cynthia Cox, senior vice president and director of the ACA Program at KFF, because they already had to pay higher premiums in 2026 and saw the expiration of more generous tax credits to offset their premiums at the end of last year.
President Joe Biden sought to bolster the program known as Obamacare by enacting more generous tax subsidies, reducing out-of-pocket costs for consumers and increasing enrollment to more than 20 million Americans. But under President Donald Trump, Republicans have sought to reduce taxpayer support for ACA coverage, allowing enhanced Biden-era subsidies to expire.
As of February, ACA enrollment was down by about 3 million people compared to the same period last year. While Cox and other policy experts say this is because rising plan costs have driven out people who feel they can get by without insurance, the Trump administration claims much of the enrollment growth under Biden was fraudulent.
The main factor driving the proposed premium increases for 2027, as in most years, is the increase in the cost and use of health care.
There is increasing demand for expensive specialty drugs and weight-loss drugs known as GLP-1, the Peterson-KFF report notes.
But the report also says that about 4 percentage points of insurers' proposed premium increases are due to the lasting effects of the expiration of enhanced subsidies. Insurers hope that as young, healthy people leave the program rather than pay higher premiums, the remaining customers will be older, sicker and therefore more expensive on average.
“It's likely that the people who dropped their coverage were also healthier people, because the sicker people were probably trying to make it work as best they could, stretching their budget to keep their health insurance,” said Cox, of KFF, a nonprofit health information organization that includes KFF Health News.
In their rate filings, some insurers also said they had to raise premiums in part because of policy changes from the Trump administration that are expected to make it harder for some people to enroll.
Along with the expiration of the larger subsidies, the new rules “account for 12.7% of the requested rate change,” insurer UnitedHealthcare wrote in its rate filing with New York state, according to the Peterson-KFF report.
“It is no surprise that insurance conglomerates that benefited greatly from the Biden-era fraud are complaining about efforts to clean up the program,” White House spokesman Kush Desai said in a statement. He added that the administration “has made clear that it will not follow in the footsteps of its predecessors by providing taxpayer-funded subsidies to large insurance companies through fraudulent and corrupt policies” and that it will “hold large insurance companies accountable.”
Another factor driving higher premiums cited by several insurers is that claims filed on behalf of patients tend to be for more intense (and expensive) levels of care than in the past. This higher severity may be because patients are actually sicker or may reflect that hospitals or doctors are using artificial intelligence to find billing codes that can maximize their payments, the report noted.
The use of AI to maximize bills is also a factor driving up the cost of health coverage offered by employers, according to consulting firm PwC, which has predicted that the cost of caring for people with employment coverage will increase by 9% in 2027.
Under the ACA, premium increases will primarily affect enrollees with incomes just above 400% of the federal poverty level, which is about $62,600 this year for an individual. This is because they are no longer eligible to receive subsidies once the enhanced tax credits expire.
People below that level get tax credits to help pay their monthly premium, depending on how much they earn and the cost of a “benchmark” ACA plan where they live. As a result, as premiums rise, so do subsidies, protecting many consumers from rising prices but also increasing costs for the federal government.
However, they may have to shop around when enrollment for 2027 coverage opens in October. Depending on their particular plan's premium, they may need to change plans to keep premiums flat, said Matthew Fiedler, a senior fellow at the Brookings Institution.
KFF Health News Senior Correspondent Julie Appleby contributed to this report.
Are you having trouble paying for your health insurance? Have you decided to waive coverage? Click here to contact KFF Health News and share your story.
