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Millions of Americans face significantly higher health insurance costs in the coming year. Whether they receive coverage through an employer, the Affordable Care Act marketplace or Medicare, most people can expect to pay more. In some cases, the increases could be the largest seen in decades. The rising costs reflect broader economic pressures, including higher hospital prices, more expensive medical care and growing spending on prescription drugs such as GLP-1 weight loss medications.
“Healthcare costs are going up faster than they have in years, and open enrollment is when the healthcare affordability crisis is really going to hit home for people,” said Larry Levitt, executive vice president for health policy at KFF, a nonpartisan research organization. “That’s true for whatever kind of insurance you have.”
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The increases will not look the same for everyone. Some people will face higher monthly premiums. Others will encounter larger deductibles or higher copays when they seek care.
ACA Marketplace Faces Second Year of Double-Digit Increases
Approximately 19 million adults purchase health insurance through the Affordable Care Act marketplace. These enrollees are heading into a second consecutive year of steep premium increases. Insurers are proposing an average premium increase of about 15% for 2027, according to a KFF analysis of public filings from insurers across all 50 states and Washington, D.C. For 2026, insurers raised rates by an average of 20%.
For example, an individual earning $80,000 a year who does not qualify for standard ACA subsidies could see the cost of a bronze plan rise by roughly $80 a month. That adds nearly $1,000 to their annual healthcare bill.
One major driver of the increases is the expiration of enhanced federal subsidies at the end of 2025. Those subsidies, first introduced during the pandemic, had lowered monthly premiums for millions of middle-class Americans. After they expired, many people either paid significantly more for coverage in 2026 or downgraded to cheaper plans. ACA enrollment fell by about 3 million as a result.
Young adults, who tend to be healthier and more likely to drop coverage when costs rise, made up a large share of those who left. That shift left insurers covering a customer base that, on average, requires more medical care. Miranda Yaver, an assistant professor of health policy and management at the University of Pittsburgh, said insurers factored that change into their 2027 rate proposals.
On Thursday, the White House promised $500 rebate checks to an estimated 1 million ACA enrollees, claiming they were wrongly overcharged. However, experts say the relief would be minimal. Yaver noted that the $500 check “pales in comparison to the increased premiums that marketplace enrollees are facing due to the expiration of the enhanced subsidies.” It also remains unclear where the funding would come from or whether Congress would need to approve the payments.
Employer-Sponsored Insurance Costs Hit a Two-Decade High
About 165 million Americans receive health insurance through their employers. Many of them will also feel the financial pressure in the coming year.
A survey of more than 1,800 employers by Marsh, a benefits consulting group, found that employers expect the cost of providing health benefits to each worker to rise 8.2% on average in 2027. That would be the largest increase since 2003.
However, that figure does not automatically mean workers’ premiums will rise by the same amount. Dr. Kevin Schulman, a professor of medicine at Stanford University School of Medicine who researches employer-based health insurance, explained that employers typically cover a large portion of workers’ premiums. When costs rise sharply, though, employers have several ways to pass some of that burden onto employees.
“Because the costs are going up, the employers are trying to reduce the rate of growth, and the easiest way to reduce the rate of growth of healthcare costs is to push more of the costs onto the employee,” Schulman said.
The Marsh survey found that about two-thirds of large employers — those with 500 or more employees — planned to increase how much workers contribute toward their premiums in 2027. Others may raise deductibles, adjust copay structures or slow wage growth to offset rising healthcare expenses. Schulman advised workers to look beyond the monthly premium during open enrollment. A plan with a lower or similar premium may carry a higher deductible or require greater out-of-pocket spending when care is needed.
Medicare Enrollees May See Prescription Drug Premiums Climb
Roughly 70 million Americans are enrolled in Medicare. Most of them pay more than one premium. Part B covers doctor visits and outpatient care. Part D, which covers prescription drugs, applies to about nine out of ten enrollees.
Prescription drug costs are where enrollees may see the most significant changes. The Centers for Medicare and Medicaid Services projected in July that the baseline monthly cost for Part D coverage will rise about 6% in 2027, moving from $38.99 to $41.33. What individuals actually pay varies based on income and their specific plan.
The increase follows the Trump administration’s decision to withdraw support for a temporary federal program that helped offset Part D premium increases. That program launched in 2025 as Medicare’s prescription drug benefit underwent major changes under the Inflation Reduction Act. Without the program, enrollees would have seen their monthly premiums nearly double, according to a report from the Government Accountability Office. The program had reduced the average premium by 40% last year.
Yaver said the change would hurt seniors, many of whom are retired and living on fixed incomes. “Though seniors don’t change their Part D plans often, this year may be an exception, potentially resulting in seniors opting into lower-quality plans, leaving them less protected,” she said.
Despite the increases, Medicare enrollees will still benefit from an annual out-of-pocket cap on prescription drug spending. In 2027, that cap is set at $2,400.
