Affordable Care Act insurers are proposing a median 14% premium increase for 2027 plans, marking the second consecutive year of double-digit hikes after a 20% median increase in 2026, according to an analysis released earlier today by the Peterson-KFF Health System Tracker and KFF.
The analysis examined preliminary rate filings from 77 insurers across 16 states and Washington, D.C. If approved, the cumulative effect over just two years would bring typical premiums for marketplace plans to a rise of more than 33%, according to Reuters reporting on the same data.
Insurers cited mounting healthcare costs, federal regulatory changes, and the expiration of pandemic-era enhanced subsidies as the primary drivers of the increases. The median proposed rate change ranges from 1% to 52% among individual insurers, with most proposals falling between 10% and 20%, according to the Peterson-KFF analysis.
Rising healthcare costs remain the single largest factor, with insurers reporting a median medical trend of 10% — higher than the typical 8% seen in recent years. Hospitals, physician services, and prescription drugs are all becoming more expensive, and insurers are incorporating those increases into their rate proposals.
General economic inflation has compounded these pressures, straining supply chains and driving up the cost of goods and services across the healthcare sector. Additionally, many insurers pointed to persistent healthcare labor shortages and elevated wages as a meaningful contributor to rising premiums. Providers facing higher staffing costs are demanding steeper reimbursement rates in contract negotiations, which insurers then pass along to consumers.
The expiration of enhanced premium tax credits at the end of 2025 has fundamentally reshaped the ACA marketplace risk pool. When those credits ended, many healthier enrollees left the marketplace because their out-of-pocket costs became unaffordable, leaving behind a population that is on average sicker and more expensive to cover. Data from the Trump administration shows the overall ACA marketplace shrank by more than 2.5 million people over the past year, with some states seeing declines of nearly a third of their enrollee population.
Insurers are projecting this dynamic will continue in 2027, with a 4 percentage point increase in premiums attributable to the deteriorating risk pool alone, according to the Peterson-KFF analysis. The effect is compounding: in 2026, the expiration of enhanced credits was estimated to drive rates 4 percentage points higher, and insurers are now building 2027 rates on top of that already-adjusted, less-healthy population.
Middle-income Americans without subsidies will face the sharpest increases. Households with incomes at or above 400% of the federal poverty level — roughly $63,000 per year for an individual or $129,000 for a family of four — do not qualify for financial assistance and will absorb the full premium increases. Some of these enrollees already saw their premiums double or triple in 2026 when the enhanced credits expired.
Most ACA marketplace enrollees do receive subsidies that insulate them from the full premium increase, but the expiration of enhanced credits has reduced the generosity of those subsidies, resulting in fewer people receiving help and higher average premium payments. For the federal government, premium increases also translate directly into higher subsidy spending.
The rate filings are preliminary and will be finalized later this summer. However, Georgetown University’s Center on Health Insurance Reforms published a separate analysis in June reaching similar conclusions, projecting another year of double-digit increases. Stacey Pogue, a senior research fellow at the center, noted that the expiration of enhanced credits has played out exactly as analysts predicted: “When the healthy people leave, the prices go up.”
Some insurers also cited federal policy changes introduced by the Trump administration, including the Marketplace Integrity and Affordability Rule and the 2027 Notice of Benefit and Payment Parameters, as contributing factors to their rate requests. Budget reconciliation legislation signed into law in July 2025 introduced additional eligibility restrictions that insurers say will further reshape the marketplace composition.
Sources
- Peterson-KFF Health System Tracker — analysis of 77 insurers’ preliminary 2027 rate filings, median 14% increase, medical trend and risk pool drivers
- AP News — confirmation of 14% median increase, 20% in 2026, subsidy expiration impact, enrollment decline data
- Reuters — 33% cumulative increase over two years (2025-2027), second-highest increase since 2018
- Georgetown University Center on Health Insurance Reforms — separate analysis of early filings, comparable findings on double-digit increases
- KFF — healthcare cost drivers, subsidy expiration analysis, marketplace enrollment and premium data
