How much would premiums rise in 2026 if ACA premium tax credits expire for different income levels?
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Executive summary
If Congress allows the enhanced ACA premium tax credits to expire at the end of 2025, average after-subsidy premium payments for Marketplace enrollees are projected to rise roughly 114% — from about $888 in 2025 to $1,904 in 2026, an increase of roughly $1,016 annually (KFF) [1] [2]. Insurer filings and analyses show two different channels of upward pressure in 2026: insurers are proposing a median gross-premium increase of about 18% largely tied to cost trends [3] [4], and the expiration of enhanced credits alone is driving additional premium increases in some filings — on average about +4 percentage points in early filings from several states [5] [6].
1. Why premiums jump: two separate drivers, both visible in filings
Insurers’ 2026 rate requests reflect routine cost pressures (medical inflation, utilization) that show a median proposed gross-premium increase near 18% (KFF analysis of filings) [3] [4]. Separately, many insurers explicitly attribute a portion of their requested increases to the expected expiration of enhanced premium tax credits — early filings in Vermont, Oregon, Washington and DC attribute an average additional 4 percentage points to that expectation [5] [6]. Those are additive effects: higher gross rates plus smaller insurer “morbidity” and market-shift assumptions tied to subsidy changes both boost what people actually pay [4].
2. How the cost burden varies by income — dramatic for lower- and middle-income enrollees
Enhanced credits lowered required contributions dramatically for low- and middle-income households; KFF models show, for example, a person earning $28,000 would pay roughly 1% of income (~$325) with enhanced credits but nearly 6% (~$1,562) if they expire — the same individual’s annual premium payment thus rises substantially [1]. KFF’s interactive analysis and calculator indicate the average Marketplace enrollee’s out-of-pocket premium would more than double (114% increase, about $1,016 additional per year) if the enhancements are not extended [2] [1].
3. Older and higher-income enrollees face concentrated pain above 400% FPL
People above 400% of poverty lose eligibility for the enhanced credits entirely; the burden is uneven because older enrollees have much higher unsubsidized premiums. KFF mapping shows at 501% of poverty and higher, benchmark premiums for a 60-year-old would at least double in most states if enhanced credits expire, with still-severe effects at 601% and 701% of poverty in many states [7]. KFF also gives a stark example: a 60‑year-old couple making about $85,000 could see annual premium payments rise by over $22,600 accounting for gross rate changes plus credit loss [1].
4. Geographic and plan-age differences magnify the unevenness
State-level filings vary: Vermont insurers forecast roughly 6–7% of their premium changes attributable to credit expiration, while some carriers (e.g., BridgeSpan in Oregon) listed 4–5 points of an overall ~12.6% increase as tied to credit expiration [5]. That means outcomes differ by insurer, state, and by the age composition of enrollees; KFF’s mapping highlights that a 40-year-old is generally less affected than a 60-year-old at the same income level [7] [5].
5. Coverage and macroeconomic consequences reported by other analysts
Beyond premium dollars, multiple analyses project large enrollment and economic effects if the credits lapse. The Congressional Budget Office and the Urban Institute forecast millions more uninsured and reduced federal outlays; some reports project nearly 5 million people losing coverage and substantial downstream economic impacts such as job loss and increased uncompensated care demand [8] [9] [10]. These broader estimates are cited by policy groups and academics arguing extension would stabilise coverage and the marketplace [11] [12].
6. What the data do not say and limits of early filings
Available sources do not give a single, definitive premium increase by income and state because (a) filings are preliminary and uneven across states, (b) IRS 2026 subsidy caps and local premiums vary, and (c) insurers’ assumptions about enrollee churn and morbidity differ [5] [4] [3]. KFF’s national averages and illustrative examples show the scale of change (e.g., +114% average net premium payment), but outcomes for any household depend on age, location, exact income, and plan choice [2] [3].
7. Bottom line for households and policymakers
Households should expect substantially higher out-of-pocket premium costs in 2026 if enhanced credits expire — especially younger low-income enrollees losing near-zero premiums and older or higher-income enrollees above 400% FPL who will face steep unsubsidized prices [1] [2] [7]. Policymakers face a clear trade-off shown in CBO and analysis briefs: extending credits raises federal outlays but would blunt large premium and coverage shocks projected by KFF, CBO, and academic studies [8] [11] [10].