Affordable Care Act marketplace benchmark premiums surged 21.7 percent in 2026, marking an extraordinary spike that far exceeds typical insurance increases and reflects the expiration of enhanced federal subsidies that had kept coverage affordable for millions of Americans.
The 21.7 percent increase in marketplace benchmark premiums—the second-lowest-cost silver plans—dwarfs the 6 to 7 percent increase projected for employer-sponsored insurance, according to research from the Urban Institute. This represents a sharp departure from the prior five years, when ACA premiums grew at an average of just 2 percent annually between 2020 and 2025.
The surge stems primarily from the expiration of enhanced premium tax credits at the end of 2025. These credits, established by the American Rescue Plan in 2021 and extended through 2025 by the Inflation Reduction Act, had capped premium payments at 8.5 percent of household income for eligible enrollees. When they lapsed, insurers anticipated a costlier and riskier enrollee pool, prompting them to raise rates substantially. New federal policies and regulatory changes added further uncertainty, contributing an estimated 9 to 10 percent of the total increase beyond medical cost trends.
Enrollment Collapse and Rising Out-of-Pocket Costs
The premium surge triggered a sharp drop in marketplace enrollment. Plan sign-ups fell by over 1 million to 23.1 million people during the 2026 Open Enrollment Period, marking the steepest single-year decline since the ACA Marketplaces launched in 2014, according to the Kaiser Family Foundation. Younger, healthier enrollees departed at the highest rates, with sign-ups among adults aged 18 to 34 declining by 542,000, or 8 percent, accounting for 46 percent of total enrollment losses.
Those who remained faced sharply higher out-of-pocket costs. Average monthly premium payments among enrollees increased 58 percent, from $113 to $178, according to KFF analysis published in May 2026. The increase was lower than the 114 percent rise initially projected because many enrollees switched to bronze plans with lower premiums but substantially higher deductibles. Average marketplace deductibles surged $1,027 per person to a record $3,786 in 2026, a 37 percent jump—the steepest increase in deductibles since the marketplaces began in 2014.
Consumers just above the “subsidy cliff” at 400 percent of federal poverty level bore the steepest burden. This group, representing just 3 percent of 2025 enrollees, accounted for 27 percent of the enrollment decline from 2025 to 2026, with sign-ups falling 44 percent. Under the expired enhanced credits, people above 400 percent of poverty had their premiums capped at 8.5 percent of income; without that protection, they faced premium payments that often doubled or tripled.
The Commonwealth Fund noted that the 2026 increase was “an aberration, far above those observed in recent years,” driven by insurers’ need to protect against heightened risk and uncertainty. In 21 states, at least one insurer exited the marketplace entirely, with Aetna withdrawing from all regions where it had previously participated. Competition among remaining insurers—a key cost-control mechanism in ACA marketplaces—weakened as a result.
Sources
- Urban Institute — Provided the 21.7 percent benchmark premium increase figure and analysis of factors driving the increase, including expiration of premium tax credits and regulatory uncertainty.
- Kaiser Family Foundation (KFF) — Published May 19, 2026 analysis detailing enrollment decline to 23.1 million, 58 percent premium payment increase, and $1,027 deductible surge; confirmed the sharpest single-year enrollment drop since 2014.
- Commonwealth Fund — Confirmed the 21.7 percent premium increase and provided context comparing ACA increases to employer-sponsored insurance trends; attributed increases to expiration of enhanced tax credits and new federal policies.
- Medicare Rights Center — Reported that enrollees facing expiration of enhanced tax credits saw premium payments double for the same coverage.
