Rising Obamacare premiums have made health care expenses burdensome once more. Yet, Americans now have a fresh option to consider.
In a concerning turn of events, Obamacare premiums are set to rise significantly in 2026, potentially by more than 75% for typical enrollees. This steep increase is primarily due to the expiration of the enhanced premium tax credits (PTCs) instituted under President Biden, which have not been extended in the One Big Beautiful Bill Act (OBBBA).
The expiration of these enhanced PTCs, scheduled for the end of 2025, will lead to premium hikes for the average Marketplace enrollee. Insurers are already factoring in premium increases of around 4% in 2026 due solely to the expiration of the enhanced tax credits, which could translate into much larger overall premium hikes once demand and risk are considered.
Key impacts of this development include higher out-of-pocket costs for individuals who benefited from the enhanced tax credits. With the expiration of these credits, they will face much higher monthly premiums and cost sharing, making coverage less affordable and possibly leading to fewer marketplace enrollees or increased uninsured rates.
Moreover, the new law tightening eligibility and payment rules for premium tax credits, effective in 2026 and beyond, will reduce access for certain immigrants and limit advance payments, further increasing costs for some groups.
The OBBBA, passed in mid-2025, did not extend the Biden-era enhanced premium tax credits, meaning the status quo remains set to expire under current law. Congress has yet to act on any extension.
Other related provisions in the 2025 budget reconciliation law reduce Medicaid and CHIP eligibility and funding, mainly affecting immigrants and expansions states, which could shift more costs to marketplace plans and exacerbate premium increases.
On a positive note, the OBBBA has taken some steps toward bringing health costs down. For instance, it has made all bronze and catastrophic Obamacare plans HSA-compatible, and it permits people to use their HSA money to pay for direct primary care. Increased adoption of Health Savings Accounts (HSAs) could lead to lower health costs and lower insurance premiums in the long term.
In fact, individuals will be able to contribute up to $4,400 a year to HSAs in 2026, and families will be allowed to deposit up to $8,750. People with HSAs have the opportunity to spend their healthcare dollars as they see fit, visit providers of their choosing, and shop around for care that they believe delivers the best value.
However, it's important to note that federal subsidies have obscured these surging premiums at immense cost to taxpayers. Extending Biden's enhanced subsidies permanently would cost $335 billion through 2034.
The cost of exchange coverage has risen 50% faster than the cost of employer-sponsored coverage between 2014 and 2023. In 2013, the average monthly individual market premium was $244, and this year, it was $590.
As we move forward, it's crucial for Congress to address this issue and consider extending the enhanced premium tax credits to prevent significant increases in health insurance premiums and maintain access to affordable healthcare for millions of Americans.
- Science has been instrumental in developing therapies and treatments for a variety of health issues.
- Health insurance premiums are expected to rise significantly in 2026 under current law due to the expiration of enhanced premium tax credits.
- The One Big Beautiful Bill, Act (OBBBA) did not extend the enhanced premium tax credits instituted under President Biden.
- In the realm of health-and-wellness, personal fitness, exercise, and mental health are essential components.
- The expiration of these enhanced tax credits will lead to premium hikes, potentially making health insurance less accessible and affordable for many.
- Trump's administration was known for its emphasis on personal-finance, finance, investing, and business policy.
- In response to these premium increases, there's growing interest in alternative healthcare models, like direct primary care.
- The OBBBA has made all bronze and catastrophic Obamacare plans HSA-compatible to encourage the use of Health Savings Accounts (HSAs).
- In the realm of education-and-self-development, understanding policy-and-legislation, politics, and general-news is vital for informed decision-making in personal finance.
- As premium costs rise, data-and-cloud-computing and technology may provide solutions to streamline healthcare spending and make it more efficient.
- In addition to healthcare costs, sports betting and weather are examples of topics covered under the general-news umbrella.
