Not so happy New Year: Affordable Care Act premiums to soar in 2026

San José, CA – With the New Year, premiums for health insurance bought through the Affordable Care Act (Obamacare) marketplace will more than double on average, from $888 in 2025 to $1904 in 2026.

Part of this is because private, for profit health insurance companies are raising the premiums on average of 18% this year. But most of the increase is because the Republican majority House of Representatives and Senate refused to extend government subsidies that lowered the cost of health insurance.

More than 20 million people will face premium increases. The doubling of costs is just an average, with many people facing far higher increases of three times, four times, or even as much as a 20-fold increase in their premiums. This will disproportionately affect people in ten mostly Republican-led states, including Texas and Florida, where the state governments did not expand Medicaid. In those states, people who would have been covered by expanding Medicaid had the use the ACA marketplaces for private health insurance. Another group more likely to face big hikes in health insurance premiums are the self-employed and employees of small businesses that don’t offer employee health benefits.

Millions of people will have to drop their health insurance, exposing them to financial ruin from health care expenses. This in turn will drive up premiums for all others, as the healthier are more likely to drop insurance, leaving those with more health problems and expenses to shoulder more of the cost.

The United States has the highest health care costs in the world, spending 50 to 100% more as a fraction of Gross Domestic Product (GDP, or total spending on domestic goods and services) as compared to other developed economies. At the same time, we have the lowest life expectancy and are falling even farther behind as U.S. life spans have stagnated for the last ten years.

This is mainly because of the for-profit health care system and lack of universal health insurance, making us almost alone among developed economies. The maternal death rate, or the number of women dying as a result of pregnancy, is high compared to other developed economies; for example, the maternal death rate in the United States is about twice as high as Canada’s. Not only that, the maternal death rate is almost twice as high as it was 35 years ago. In contrast, the maternal death rate in socialist China has dropped 80% in the last 35 years, so that their rate is about the same as the United States.

While Trump campaigned on a promise to lower prices on “day one,” in fact, prices have been rising at a fast rate in 2025, and could rise even more in 2026 because of the administration’s policies of higher tariffs on imports and reducing subsidies for health insurance.

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