Many Americans who use Obamacare for health coverage will see double-digit premium increases in 2027.
Rates for mid-tier, or “benchmark,” plans on the Affordable Care Act’s exchanges will rise by an average of 13%, according to a KFF analysis of Trump administration price data released Friday.
Insurers pointed to higher medical costs and the GOP’s decision to let enhanced subsidies for program users expire, saying it changed the mix of enrollees and impacted costs.
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“In their rate filings, insurers point to a higher-than-usual increase in the underlying cost of care, which is not unique to the ACA Marketplaces; some employer plans have also seen steep cost increases,” KFF said in its analysis. “ACA Marketplace insurers also cite the expiration of the enhanced premium tax credits and the resulting changes in the risk pool as factors contributing to higher premiums.”
It is the second straight year of double-digit rate hikes on Obamacare, the law Democrats muscled to passage under President Barack Obama in 2010.
Obamacare enrollment grew to more than 24 million enrollees during the Biden administration. It slid to around 19 million this year, after President Trump and Republicans canceled supersized subsidies from the Biden era.
Mr. Trump is no fan of the law. He tried to repeal it in 2017, but settled for canceling the “individual mandate” penalty for lacking insurance.
His administration is tasked with implementing the law, regardless of how he feels about it. The administration pointed to affordable options in a Friday press release.
The Centers for Medicare and Medicaid Services said about three-quarters of Americans who purchase coverage through the federal exchange, HealthCare.gov, will find plans with premiums at or below $50 in 2027.
Since its launch in late 2013, Obamacare has been vulnerable to premium shocks from fluctuations in the pool that spreads out insurers’ risk.
People earning at least 400% of the federal poverty level will not qualify for subsidies and feel the full brunt of the premium increases.
“Sharp premium increases in 2027 follow even steeper increases going into 2026,” KFF said. “These higher costs may lead additional healthier enrollees to drop coverage, further worsening the risk pool and putting additional upward pressure on premiums.”
CMS announced the rate hikes days before Tuesday’s midterm elections.
Mr. Trump is touting his record on health care, pointing to reductions in drug prices under his Most Favored Nation model for Medicaid programs and TrumpRx, where customers can pay cash for reduced-cost drugs.
He recently sent out $500 rebates to unsubsidized Obamacare customers to offset high costs.
Democrats tend to poll better than Republicans on handling health care, however, and liberal candidates are pushing to restore supersized Obamacare subsidies canceled by Republicans in the “One Big Beautiful Bill.”
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