Every spring and summer, health insurers submit rate filings to state regulators detailing expectations and premium rate changes for individual market health plans for the coming year. This analysis focuses on individual market filings for plans selling Affordable Care Act (ACA) Marketplace coverage. These filings provide insight into what factors insurers expect will drive health costs for the coming year. The individual market is mostly comprised of people enrolled in Affordable Care Act (ACA)-compliant health plans, particularly those sold through the Marketplaces (Healthcare.gov and state-run platforms like Covered California). While less than 10% of Americans get their health coverage through the individual market, many of the factors driving premiums in this market – like growth in hospital or pharmaceutical costs – are similar across all private plans, and the detailed filings available for ACA-compliant coverage provide insight into these cost drivers. There are also issues unique to ACA Marketplace plans, including federal premium assistance for most purchasers and regulations governing how they operate.
For 2027, across 77 insurers participating in the ACA Marketplaces from the 16 states and the District of Columbia with publicly available filings, this analysis shows a median proposed premium increase of 14%. This is the second consecutive year of double-digit premium hikes. Last year’s median nationwide proposed rate change was 18%, and the median finalized rate change was 20%. While this proposed rate change is lower than last year, it represents the second-highest requested rate change since 2018, as premium growth had been relatively flat in this market for several years. If these early indications of median premium increases for 2027 hold, typical premiums for insurers participating in the ACA Marketplaces will have jumped by more than one-third over a two-year period.
ACA Marketplace insurers are proposing a median premium increase of about 14% in 2027
States with publicly available proposed rates included in this analysis are Connecticut, the District of Columbia, Hawaii, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Minnesota, New York, Oregon, Rhode Island, Texas, Vermont, and Washington. Note that Hawaii, Illinois, and Texas only have publicly available filings for a portion of their state’s participating insurers.
Based on a detailed analysis of available documents from insurers in these 16 states and the District of Columbia, growth in underlying healthcare prices, as in prior years, stood out as a key factor driving costs in 2027. As discussed in more detail below, insurers cite the rising cost of health services, general economic inflation, and labor shortages as contributing to cost growth.
Insurers also cite some factors that are unique to the individual market, particularly the expiration of enhanced premium tax credits at the end of 2025 and a related increase in the risk pool’s morbidity, as contributing to rising rates for 2027. The expiration of these tax credits led to a decrease in enrollment in 2026, with healthier enrollees more likely to drop their coverage. Individual market insurers are expecting the market to continue to deteriorate in 2027 as a result of the expiration of these enhanced tax credits. Other federal policy changes, such as the Trump administration’s ACA Marketplace Integrity and Affordability Rule, the 2027 Notice of Benefit and Payment Parameters, and H.R. 1 – The Working Families Tax Cut Act were also discussed, though to a lesser extent.
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Among the 77 ACA Marketplace participating insurers from 16 states and the District of Columbia, premium changes range from 1% to 52%, but most proposed premium changes for 2027 fall between 10% and 20% (the 25th and 75th percentile are 12% and 21%, respectively). Of the insurers included in this analysis, none proposed decreasing premiums. At the other end of the spectrum, 20 insurers requested premium increases of more than 20%. These filings are preliminary and may change during the rate review process. Rates for 2027 will be finalized in late summer.
There are several ways to assess premium changes in this market. This analysis measures a given insurer’s premium increase as the enrollment-weighted average rate change across all of its products within a state (bronze, silver, gold, and platinum plans). These weighted averages differ from changes in the benchmark silver plan, which is the basis for federal subsidies. In 2026, the median proposed rate increase was 18%, while benchmark silver premiums rose 26% on average once finalized, so it is not an “apples-to-apples” comparison.
Most people who signed up for an ACA Marketplace plan receive a premium subsidy (87% in 2026) and may be insulated from premium increases depending on the plan they select. But the expiration of enhanced premium tax credits reduced financial assistance across the board, resulting in a smaller share of people receiving subsidies and higher average premium payments driving people to opt for lower-premium bronze plans that tend to have higher deductibles. For the federal government, premium increases also translate directly into higher subsidy spending.
The double-digit rate increases proposed for 2027 follow an already steep climb. For enrollees with incomes just above four times the federal poverty level — who are newly ineligible for subsidies with the expiration of the enhanced premium tax credits — that cumulative increase is especially sharp over the last two years. Consider a 40-year-old in Indianapolis, Indiana, enrolled in Anthem Heart Healthy Silver Essential 4500 earning $65,000 per year: with enhanced premium tax credits, their premium payment was $316 per month (their unsubsidized monthly premium would have been $388 in 2025), then the premium climbed to $477 in 2026 as those credits expired and premiums rose, and it will reach $546 per month in 2027 if these rates are approved — a cumulative increase in monthly premium payments of $158, or 41%, over just two years.
What is driving 2027 premium changes?
Rising healthcare costs
Trend
As in most years, rising healthcare costs — a function of the price of care and increased utilization — are the primary driver of higher premiums. Hospitalizations, physician visits, and prescription drugs all tend to get more expensive each year, and insurers raise premiums accordingly. For 2027, the median change in the underlying cost of medical care and prescription drugs (medical trend) was 10%. This is higher than the average medical trend of 8% in each of the last few years.
Below are some illustrative quotes from insurer rate filings:
“The most significant component is trend and experience. Rising medical cost trends, contract increases with providers, and 2025 experience performing worse than expected account for a significant portion of the rate increase. Annualized trend is 10.2%. This component contributes about $78 PMPM to the overall premium increase.” – Moda Health Plan, Inc. (Oregon)
“Medical inflation related to the utilization and cost of covered services increased claims by 9.2%. Trend is one of the primary contributors to an increase in rates. Changes in provider contracting rates also contributes to the regional rate changes.” – ConnectiCare Benefits, Inc. (Connecticut)
General economic inflation
In addition to rising healthcare prices, many insurers also cited general economic inflation as a driver of higher provider costs. Broader inflationary pressure has strained supply chains and pushed prices higher across the economy, including the healthcare sector.
“Significant inflation in the cost of goods and services in all sectors of the economy has had a profound impact on the cost of medical services, and BCBSRI expects to see substantial increases in provider unit costs for 2027.” – Blue Cross Blue Shield of Rhode Island (Rhode Island)
“We have not included an explicit adjustment for tariffs in our pricing. However, our rate development reflects broader economic factors that may influence medical unit costs and pharmacy pricing, including potential impacts to supply chain and input costs. These considerations are incorporated into our overall assumptions, including a modest incremental increase to trend above typical contracting adjustments to account for evolving economic conditions.” – Anthem Insurance Companies (Indiana)
Labor supply
Some insurers also point specifically to healthcare labor costs as a component of medical trend, driven by persistent workforce shortages and elevated wages, as a meaningful contributor to rising premiums. Providers facing higher staffing costs and lingering post-pandemic financial pressures are seeking steeper reimbursement rates in contract negotiations, and insurers incorporate those increases into their trend assumptions.
“Local hospital systems have been challenged financially due to both economic inflationary pressures as well as staffing shortages. Excellus Health Plan has responded to these provider challenges through additional contractual cost increases for our provider systems, resulting in more spending for hospital services.” – Excellus Health Plan, Inc. (New York)
“For 2026 and 2027, THPP expects there to be continued upward pressure on medical cost increases, driven by the higher inflationary environment and labor shortages that have led to providers requesting higher rates of reimbursement. While THPP expects to successfully partner with hospitals and physicians across the state to moderate these cost increases, and continue to make quality care accessible for all, the increases are expected to be above historical levels.” – Tufts Health Public Plans, Inc. (Massachusetts)
Increasing severity of claims
Several insurers also cite increasing claims severity — the complexity and costliness of individual claims — as a notable driver of rising premiums. Providers are increasingly coding and billing for higher-acuity services, resulting in claims that reflect more intensive levels of care and higher reimbursement rates, which contributes to higher medical trend. Whether driven by genuine increases in patient complexity or shifts in billing practices – such as using AI to maximize billable services – this trend toward higher-severity claims translates directly into higher costs for insurers and, ultimately, higher premiums.
“We’ve seen use and severity trend accelerate through the end of 2025. This is not an anomaly, but rather reflects observable, sustained increases in underlying medical utilization and severity identified by our Trend Analytics Team. We are experiencing persistent utilization pressures across multiple service categories, most notably in outpatient surgeries (including digestive and cardiovascular surgeries), rising behavioral health visit volumes, and increased medical pharmacy use. We have also observed and measured an increase in the severity component of trend. We have measured the impact of changes in the way providers are billing both inpatient and outpatient services to increase provider revenue with no appreciable difference in the way care is delivered.” – Blue Cross Blue Shield of Massachusetts HMO Blue (Massachusetts)
GLP-1s
Over the past few years, the high cost and growing demand for GLP-1 medications have been adding significant upward pressure and leading to higher premiums for insurers. In response, some insurers have dropped coverage of these drugs for weight loss while continuing to cover them for diabetes management and say this change will have a downward effect on 2027 premium increases. Other insurers say the increased utilization of these drugs will continue to have an upward effect on premiums in 2027.
“Despite discontinuing coverage for GLP-1s for weight loss, we continue to see rising utilization for diabetic GLP-1s as these treatments increasingly are being used to treat diabetes and expanded for other conditions.” – Mass General Brigham Health Plan (Massachusetts)
“Beginning January 1, 2026, MVP is no longer covering weight loss GLP-1 drugs except for certain medically accepted indications. MVP found, after analyzing the emerging data for the 1st quarter of 2026, that utilization of weight loss GLP-1 drugs has dropped. MVP has therefore reduced the experience period data to only reflect $4 PMPM, which is our best estimate of 2026 expense based on emerging trends and seasonality. This adjustment reduces the premium by $8.71 PMPM. Please note that this is the net impact on claim expense after considering any reduction in manufacturer rebates as a result of this policy change.” – MVP Health Care (Vermont)
“For Healthfirst, the QHP gross cost PMPM of GLP-1s has more than tripled over the past two years (in the graph and table below, see the Feb-24 PMPM of $13 vs. the Feb-26 PMPM of $49), as has the proportion of adult QHP members utilizing GLP-1s since early 2024 (in the table below, see the Feb-24 proportion of 1.6% vs. the Feb-26 proportion of 5.4%).” – Healthfirst PHSP (New York)
“EHP is expecting the increasing costs of GLP-1 drugs to be a major impact in 2027 claim experience. The cost for these drugs is expected to increase by $28.30 PMPM from 2025 to 2027.” – Excellus (New York)
Provider consolidation
In a very small number of filings, insurers also point to provider consolidation, through hospital mergers and acquisitions, as contributing to higher contracted prices for services due to increased provider market power.
“The high unit cost increases reflect continued pressure from provider contract negotiations, including provider requests for double-digit reimbursement increases in certain markets. Limited competition and regional monopolies have reduced downward pricing pressure, and some hospital systems and health care providers have shown a willingness to allow our contracts to expire.” – Premera Blue Cross (Washington)
No Surprises Act
The No Surprises Act (NSA), enacted in 2022, introduced consumer protections against certain surprise medical bills, most notably by requiring that patients who receive out-of-network services at in-network facilities be charged only for in-network cost sharing. To resolve payment disputes between providers and insurers, the NSA instituted an independent dispute resolution (IDR) process. In practice, providers have initiated a large majority of payment disputes and have prevailed in most of them, frequently securing payments exceeding the median in-network rate, driving up costs for insurers and contributing to higher premiums, an outcome that stood in stark contrast to projections from the Congressional Budget Office. The IDR process has also faced a series of legal challenges since its inception, creating ongoing uncertainty around its implementation and scope. One insurer mentioned the No Surprises Act as a driver of healthcare costs.
“A rate impact of 0.8% is added for costs associated with the Independent Dispute Resolution process, including both the federal program and additional New York-specific requirements.” – UnitedHealthcare of New York (New York)
Federal policy changes that uniquely affect the individual market
Expiration of the enhanced premium tax credits
Insurers in the individual market must also account for the lasting effects of the enhanced premium tax credits’ expiration at the end of 2025, which has reshaped the risk pool in 2026 and is expected to continue to lead to further market deterioration heading into 2027. As anticipated, many healthier enrollees left the ACA Marketplaces in 2026 as their subsidies decreased – leading to an average increase in premium payments after subsidies of 58% this year – leaving behind an enrollee base that is on average somewhat sicker and more expensive to cover. For 2026, this dynamic was estimated to drive rates an average of 4 percentage points higher than they otherwise would have been, and insurers are now building 2027 rates on top of that adjusted, less-healthy risk pool — compounding the effect into next year’s premiums as well. In 2027, among those adjusting for the expiration of the enhanced premium tax credits, insurers are projecting this dynamic to continue driving premiums up again by roughly 4 percentage points higher than otherwise would have been.
“For the rating period, morbidity for enrollees overall is expected to be higher compared to the morbidity of members in the experience period data due to market contraction as a result of subsidy changes in the Individual market. The expected relative cost of new members coming into the pool is expected to be lower than the cost of continuously enrolled members” – Kaiser Foundation Health Plan of the Mid-Atlantic States (District of Columbia)
“The enhanced Advanced Premium Tax Credit (eAPTC) subsidies first introduced through the American Rescue Plan Act (ARPA) and later extended by the Inflation Reduction Act (IRA) expired at the end of 2025, and while we observe an increase in 2026 open enrollment relative to 2025 open enrollment, we anticipate a reduction in the overall market size between the base period and projection period as effectuated enrollment develops throughout the year and additional consumers leave the market in 2027. This will lead to increased average statewide morbidity in 2027 as consumers either lose access to subsidies (for those at or above 400% of the Federal Poverty Level) or face higher net premiums due to less generous subsidies. We anticipate the remaining risk pool in 2027 to have higher healthcare needs, on average, as healthier consumers are more likely to lapse coverage. Given these considerations, we incorporate a morbidity adjustment of 6.0% to reflect greater anticipated changes in statewide average morbidity in 2027 relative to the manual rate.” – Antidote Health (Texas)
“We expect to see a reduction in the overall market size in 2027. We expect the expiration of the enhanced premium subsidies first introduced through the ARPA – and later extended by the Inflation Reduction Act (IRA) – at the end of 2025 to result in fewer individual members enrolled in exchange plans … We anticipate the remaining risk pool in 2027 will have higher healthcare needs, on average, as healthier individual consumers are more likely to lapse coverage and healthier small groups move to alternate funding arrangements. To account for these changes, we included a morbidity adjustment of 4.7%.” – Maine Community Health Options (Maine)
“The enhanced premium subsidies first introduced through the American Rescue Plan Act (ARPA) and later extended by the Inflation Reduction Act (IRA) expired at the end of 2025. We observe a reduction in the overall market size in early 2026, and we expect continued decline in enrollment throughout 2026 and into 2027 as consumers have either lost access to subsidies (for those at or above 400% of the Federal Poverty Level) or face higher net premiums due to less generous subsidies. We expect this will lead to an increase in average statewide morbidity in 2027 relative to the manual rate experience.” – AmeriHealth Caritas (Indiana)
“The enhanced premium tax credits that were created by the American Rescue Plan expired on December 31, 2025. Per a source provided by DFS on April 14, 2025 (the letter from the Congressional Budget Office (CBO)) by not extending premium tax credits CBO expects: ‘That healthier-than-average people will exit the marketplace…and in response insurers will raise premiums for the remaining enrollees…Without a permanent extension, CBO estimates, gross benchmark premiums will increase by 4.3 percent in 2026, by 7.7 percent in 2027 and by 7.9 percent, on average, over the 2026-2034 period.’ As a result, we increased our projected claims by 7.7%.” – Health Insurance Plan of Greater New York (New York)
Federal regulatory changes
Some insurers cite federal regulatory changes, including the recent Notice of Benefit and Payment Parameters (NBPP) and the Marketplace Integrity and Affordability Rule, as having an upward effect on premiums.
“The impact of the expiration of the American Rescue Plan Act expanded subsidies and the CMS Marketplace Integrity and Affordability Proposed Rule account for 12.7% of the requested rate change.” – UnitedHealthcare of New York (New York)
“Specifically, Oscar anticipated changes to the market morbidity associated with the change in New York’s enrollment for the projection period relative to the experience period, due to the ending of the enhanced subsidies introduced by the American Rescue Plan Act, as well as the several new enrollment and eligibility procedures and requirements introduced by regulations including, but not limited to, the 2025 Marketplace Integrity and Affordability Proposed Rule and the HHS Notice of Benefit and Payment Parameters for 2027 Final Rule.” – Oscar (New York)
The NBPP is released annually and establishes guidance for how the Marketplaces will operate. However, the 2027 NBPP was not finalized until after some insurers had already prepared their 2027 premium rate filings. Some insurers noted that the late finalization of the NBPP created uncertainty in their 2027 rate filings.
“The Final 2027 NBPP has not been released. Should it differ materially from the draft 2027 NBPP with relation to de minimis ranges or any of factors pursuant to standard plan designs, it could impact the accuracy of this report.” – Coordinated Care Corporation (Washington)
“The U.S. Department of Health and Human Services Notice of Benefit and Payment Parameters for 2027 Final Rule was finalized on May 15, 2026. To meet the May 21 submission deadline, the URRT template submitted with this filing includes limited information for CSR base period reporting. The final rule indicated that issuers should use the standard methodology for CSR reporting prior to rates being finalized. Accordingly, the URRT will be updated once further guidance is provided through NY DFS, and we will work toward completing the base period CSR reporting using the standard methodology in the interim.” – MetroPlus (New York)
Some specific provisions from the NBPP that were mentioned among the reviewed rate filings are pre-enrollment special enrollment period verification requirements and multi-year catastrophic coverage.
“Rates also reflect provisions regarding pre-enrollment SEP verification as specified in the 2027 NBPP proposed rule.” – Iowa Total Care (Iowa)
“We recommend maintaining an annual rating framework for catastrophic plans for plan year 2027. If multi-year terms are finalized, they should be limited to shorter durations with delayed implementation. Extending plan terms beyond one year introduces uncertainty related to adverse selection, enrollment volatility, and risk adjustment, which may complicate actuarially sound pricing and increase solvency risk, particularly given limited experience data and ongoing market changes. Allowing time for guidance and operational updates would reduce solvency and pricing risk.” – Anthem Insurance Companies (Indiana)
H.R. 1 – Working Families Tax Cut Act
The budget reconciliation legislation, also known as the “One Big, Beautiful Bill” or “Working Families Tax Cut Act,” was signed into law in July 2025 and affected several federal health programs, including the ACA Marketplaces and Medicaid. Implementation of policies related to the ACA Marketplaces began in 2026, though others are set to begin later. Starting in 2026, a person enrolling in the Marketplace through a non-qualifying life event (QLE) special enrollment period (SEP) and low-income immigrants who are ineligible for Medicaid due to their immigration status are ineligible from receiving financial assistance on the Marketplace.
The budget reconciliation legislation was rarely mentioned in rate filings, but when referenced, discussed the law’s impact on coverage eligibility.
“The implementation of the federal law H.R. 1 also known as the One Big Beautiful Bill Act is driving significant shifts in how individuals and families qualify for coverage and what they pay for their health plans. Further, the expiration of enhanced premium tax credits has affected affordability, reducing the financial support that previously made health insurance more accessible for our members. These federal policy changes negatively affect the risk pool, through the loss of lower-risk members and limit access to more affordable plan options, particularly for our Health Connector members.” – Mass General Brigham Health Plan, Inc. (Massachusetts)
“CHPW anticipates that the potential influx of former Medicaid members related to new HR1 requirements could also affect morbidity and risk adjustment dynamics.” – Community Health Plan of Washington (Washington)
“In accordance with the federal Public Law 119-21 (the “One Big Beautiful Bill” or “OB3”), an additional adjustment of 1.056 was applied to account for temporary legal immigrants losing APTC eligibility in 2027, as well as the continued 2026 impacts of immigrants earning less than 100% FPL losing APTC eligibility. This factor also reflects expected impacts of the reduced state premium subsidies for 2027 and the continued impacts of the subsidy cliff returning for consumers above 400% FPL beginning in 2026.” – Optimum Choice – UnitedHealthcare (Maryland)
Appendix
The Peterson Center on Healthcare and KFF are partnering to monitor how well the U.S. healthcare system is performing in terms of quality and cost.
