Latest news with #premiumincreases
Reuters
4 days ago
- Business
- Reuters
U.S. health insurers seek largest jump in Obamacare premiums since 2018, study shows
July 18 (Reuters) - U.S. insurers are requesting the biggest premium increases for Obamacare plans since 2018, according to an analysis by health-research firm KFF, prompted by the looming expiry of premium tax credits and potential tariffs on medical goods. Insurers are proposing a median premium increase of 15% for 2026, KFF said, citing data from rate filings of 105 insurers across 19 states. In recent years, premiums in the plans have been relatively flat or grown only modestly. The industry has been struggling with changing enrollment patterns and rising medical costs. Insurers such as UnitedHealth (UNH.N), opens new tab and Centene (CNC.N), opens new tab have suspended their annual earnings forecasts while others have lowered their profit targets. Insurance companies pointed to the slower market growth and a rise in higher-risk patients enrolled in plans under Affordable Care Act, or Obamacare. The plans primarily serve people who do not get insurance either through an employer, Medicaid for low-income people or Medicare for older adults. The companies also cited the planned 2026 expiration of COVID-era premium tax credits as a reason, with KFF's analysis showing insurers will raise premiums by an additional 4% than they would if the enhanced tax credits were renewed. For 2026, insurers generally reported that the underlying cost of healthcare remains around last year's 8% increase. Several noted that GLP-1 weight-loss and diabetes drugs are driving costs higher, along with labor market pressures affecting negotiations with healthcare providers. Insurers also flagged uncertainty surrounding the "ACA Integrity Rule", a set of regulations finalized to strengthen verification and reduce improper enrollments in Obamacare plans, according to the report. Health insurers Centene, Molina, UnitedHealth, Cigna, Elevance, CVS Health, Oscar Health and Kaiser Permanente did not immediately respond to requests for comment.
CNN
4 days ago
- Health
- CNN
ACA insurers propose biggest premium hikes since 2018 as Trump policies take hold
Affordable Care Act insurers are proposing their steepest premium increases since 2018, driven in part by the looming expiration of Biden-era enhanced premium subsidies and by the Trump administration's tariffs, a new KFF analysis has found. Insurers are asking for a typical rate increase of 15% with more than a quarter proposing hikes of 20% or more. KFF, a nonpartisan health policy research group, looked at 105 Obamacare insurers in 19 states and the District of Columbia that have filed rates so far. Steep rate increases in 2018 were also fueled by Trump administration policies, which were focused on weakening the ACA during the president's first term after Republicans in Congress failed to repeal it in 2017. While rising health care costs account for about half of the coming year's proposed increases, two other forces under the control of President Donald Trump and congressional Republicans are also driving up rates, KFF found. The expiration of the enhanced ACA premium subsidies at the end of this year is prompting many insurers to hike rates by an additional 4%, on average. Insurers are concerned that the disappearance of this beefed-up assistance will prompt many, largely healthier consumers to drop their coverage — leaving sicker, costlier policyholders on the exchanges. Initially created by the Democrats' American Rescue Plan Act in 2021, the enhanced premium subsidies enable lower-income enrollees to sign up for coverage with very low or no monthly premiums. Also, middle-income Americans can qualify for assistance for the first time. The Biden administration repeatedly said the more generous subsidies allow the majority of enrollees to select plans that cost less than $10 a month. The enhanced subsidies helped drive Obamacare signups to a record 24 million people for 2025. Most enrollees qualify for subsidies, which greatly lower their monthly premium payments. But once the beefed-up assistance lapses, those payments are expected to spike by 75%, on average, KFF said. Trump and GOP lawmakers did not include an extension of the subsidies in their 'big, beautiful bill' and it remains to be seen whether they push for it in subsequent legislation. However, the clock is ticking since insurers are currently finalizing their rates, and the Obamacare federal and state exchanges need time to prepare for open enrollment, which starts on November 1. Several states are highlighting the looming loss of the enhanced subsidies as driving up insurers' proposed rates on their exchanges. In Maryland, for instance, carriers have requested an overall average premium change of 17.1%, the highest since 2019. If Congress extends the enhanced subsidies, the rate increases would be 7.9%, on average, according to the Maryland Insurance Administration, which is looking into creating a state-sponsored subsidy to offset some of the premium increases. Also, some insurers are pointing to the tariffs that the Trump administration has promised to impose on pharmaceutical imports, KFF said. Those that cite tariffs say the levies will add 3% to their premium proposals. The rate filings, however, do not mention specific impacts of the 'big, beautiful bill' because insurers generally had to submit their proposals prior to the bill being signed into law on July 4. Those that mention it point to the uncertainty it is causing, said Cynthia Cox, director of KFF's Program on the ACA. 'We're going to be watching over the next few weeks whether insurers come back and say, 'the big, beautiful bill passed, and here's how we think that might affect our premiums,'' she said. The filings also don't take into account the provisions in a rule that the Centers for Medicare and Medicaid Services finalized in late June that will make several changes to Obamacare, including shortening the open enrollment period, increasing verification requirements and limiting the ability of low-income Americans to sign up for coverage year-round. The measures are a 'mixed bag' for insurers in terms of how it might affect premiums, Cox said. One major insurer has already announced its departure from the Affordable Care Act in 2026. Aetna said in May that it would stop selling plans on the individual market because 'it became clear we would not be able to provide the same level of value we've offered in prior years,' the company said on its website. The insurer also left the Obamacare exchanges in 2018 but later returned. Insurers' 2026 rates are preliminary and are subject to change, particularly in states that run their own exchanges, where state regulators have more of a say in setting the final rates. The final rates should be published later this summer, and consumers will be able to view plan premiums shortly before open enrollment starts.
CNN
4 days ago
- Health
- CNN
ACA insurers propose biggest premium hikes since 2018 as Trump policies take hold
Affordable Care Act insurers are proposing their steepest premium increases since 2018, driven in part by the looming expiration of Biden-era enhanced premium subsidies and by the Trump administration's tariffs, a new KFF analysis has found. Insurers are asking for a typical rate increase of 15% with more than a quarter proposing hikes of 20% or more. KFF, a nonpartisan health policy research group, looked at 105 Obamacare insurers in 19 states and the District of Columbia that have filed rates so far. Steep rate increases in 2018 were also fueled by Trump administration policies, which were focused on weakening the ACA during the president's first term after Republicans in Congress failed to repeal it in 2017. While rising health care costs account for about half of the coming year's proposed increases, two other forces under the control of President Donald Trump and congressional Republicans are also driving up rates, KFF found. The expiration of the enhanced ACA premium subsidies at the end of this year is prompting many insurers to hike rates by an additional 4%, on average. Insurers are concerned that the disappearance of this beefed-up assistance will prompt many, largely healthier consumers to drop their coverage — leaving sicker, costlier policyholders on the exchanges. Initially created by the Democrats' American Rescue Plan Act in 2021, the enhanced premium subsidies enable lower-income enrollees to sign up for coverage with very low or no monthly premiums. Also, middle-income Americans can qualify for assistance for the first time. The Biden administration repeatedly said the more generous subsidies allow the majority of enrollees to select plans that cost less than $10 a month. The enhanced subsidies helped drive Obamacare signups to a record 24 million people for 2025. Most enrollees qualify for subsidies, which greatly lower their monthly premium payments. But once the beefed-up assistance lapses, those payments are expected to spike by 75%, on average, KFF said. Trump and GOP lawmakers did not include an extension of the subsidies in their 'big, beautiful bill' and it remains to be seen whether they push for it in subsequent legislation. However, the clock is ticking since insurers are currently finalizing their rates, and the Obamacare federal and state exchanges need time to prepare for open enrollment, which starts on November 1. Several states are highlighting the looming loss of the enhanced subsidies as driving up insurers' proposed rates on their exchanges. In Maryland, for instance, carriers have requested an overall average premium change of 17.1%, the highest since 2019. If Congress extends the enhanced subsidies, the rate increases would be 7.9%, on average, according to the Maryland Insurance Administration, which is looking into creating a state-sponsored subsidy to offset some of the premium increases. Also, some insurers are pointing to the tariffs that the Trump administration has promised to impose on pharmaceutical imports, KFF said. Those that cite tariffs say the levies will add 3% to their premium proposals. The rate filings, however, do not mention specific impacts of the 'big, beautiful bill' because insurers generally had to submit their proposals prior to the bill being signed into law on July 4. Those that mention it point to the uncertainty it is causing, said Cynthia Cox, director of KFF's Program on the ACA. 'We're going to be watching over the next few weeks whether insurers come back and say, 'the big, beautiful bill passed, and here's how we think that might affect our premiums,'' she said. The filings also don't take into account the provisions in a rule that the Centers for Medicare and Medicaid Services finalized in late June that will make several changes to Obamacare, including shortening the open enrollment period, increasing verification requirements and limiting the ability of low-income Americans to sign up for coverage year-round. The measures are a 'mixed bag' for insurers in terms of how it might affect premiums, Cox said. One major insurer has already announced its departure from the Affordable Care Act in 2026. Aetna said in May that it would stop selling plans on the individual market because 'it became clear we would not be able to provide the same level of value we've offered in prior years,' the company said on its website. The insurer also left the Obamacare exchanges in 2018 but later returned. Insurers' 2026 rates are preliminary and are subject to change, particularly in states that run their own exchanges, where state regulators have more of a say in setting the final rates. The final rates should be published later this summer, and consumers will be able to view plan premiums shortly before open enrollment starts.
CBS News
4 days ago
- Business
- CBS News
Millions could face higher ACA premiums, lower subsidies: "There will be sticker shock"
Most of the 24 million people in Affordable Care Act health plans face a potential one-two punch next year — double-digit premium increases along with a sharp drop in the federal subsidies that most consumers depend on to buy the coverage, also known as Obamacare. Insurers want higher premiums to cover the usual culprits — rising medical and labor costs and usage — but are tacking on extra percentage point increases in their 2026 rate proposals to cover effects of policy changes advanced by the Trump administration and the Republican-controlled Congress. One key factor built into their filings with state insurance departments: uncertainty over whether Congress allows more generous, COVID-era ACA tax subsidies to expire at the end of December. "The out-of-pocket change for individuals will be immense, and many won't actually be able to make ends meet and pay premiums, so they will go uninsured," said JoAnn Volk, co-director of the Center on Health Insurance Reforms at Georgetown University. Especially if the higher subsidies expire, insurance premiums will be among the first financial pains felt by health care consumers after policy priorities put forward by President Trump and the GOP. Many other changes — such as additional paperwork requirements and spending cuts to Medicaid — won't occur for at least another year. But spiking ACA premiums, as the nation heads into key midterm elections, invites political pushback. Some on Capitol Hill are exploring ways to temper the subsidy reductions. "I am hearing on both sides — more from Republicans, but from both the House and Senate" — that they are looking for levers they can pull, said Pennsylvania-based insurance broker Joshua Brooker, who follows legislative actions as part of his job and sits on several insurance advisory groups. In initial filings, insurers nationally are seeking a median rate increase — meaning half of the proposed increases are lower and half higher — of 15%, according to an analysis for the Peterson-KFF Health System Tracker covering 19 states and the District of Columbia. KFF is a national health information nonprofit that includes KFF Health News. That's up sharply from the last few years. For the 2025 plan year, for example, KFF found that the median proposed increase was 7%. Health insurers "are doing everything in their power to shield consumers from the rising costs of care and the uncertainty in the market driven by recent policy changes," wrote Chris Bond, a spokesperson for AHIP, the industry's lobbying group. The emailed response also called on lawmakers "to take action to extend the health care tax credits to prevent skyrocketing cost increases for millions of Americans in 2026." Neither the White House nor the Department of Health and Human Services responded to requests for comment. These are initial numbers and insurance commissioners in some states may alter requests before approval. Still, "it's the biggest increase we've seen in over five years," said analysis co-author Cynthia Cox, a KFF vice president and director of its Program on the ACA. Premiums will vary based on where consumers live, the type of plan they choose, and their insurer. For example, Maryland insurers have requested increases ranging from 8.1% to 18.7% for the upcoming plan year, according to an analysis of a smaller set of insurers by Georgetown University researchers. A much larger swing is seen in New York, where one carrier is asking for less than a 1% increase, while another wants 66%. Maryland rate filings indicated the average statewide increase would shrink to 7.9% from 17.1% — if the ACA's enhanced tax credits are extended. Most insurers are asking for 10% to 20% increases, the KFF report says, with several factors driving those increases. For instance, insurers say underlying medical costs — including the use of expensive obesity drugs — will add about 8% to premiums for next year. And most insurers are also adding 4% above what they would have charged had the enhanced tax credits been renewed. But rising premiums are just part of the picture. A bigger potential change for consumers' pocketbooks hinges on whether Congress decides to extend more generous tax credits first put in place during President Joe Biden's term as part of the American Rescue Plan Act in 2021, then extended through the Inflation Reduction Act in 2022. Those laws raised the subsidy amounts people could receive based on their household income and local premium costs and removed a cap that had barred higher earners from even partial subsidy assistance. Higher earners could still qualify for some subsidy but first had to chip in 8.5% of their household income toward the premiums. Across the board, but especially among lower-income policyholders, bigger subsidies helped fuel record enrollment in ACA plans. But they're also costly. A permanent extension could cost $335 billion over the next decade, according to the Congressional Budget Office. Such an extension was left out of the policy law Mr. Trump signed on July 4 that he called the "One Big, Beautiful Bill." Without action, the extra subsidies will expire at the end of this year, after which the tax credits will revert to less generous pre-pandemic levels. That means two things: Most enrollees will be on the hook to pay a larger share of their premiums as assistance from federal tax credits declines. Secondly, people whose household income exceeds four times the federal poverty level — $84,600 for a couple or $128,600 for a family of four this year — won't get any subsidies at all. If the subsidies expire, policy experts estimate, the average amount people pay for coverage could rise by an average of more than 75%. In some states, ACA premiums could double. "There will be sticker shock," said Josh Schultz, strategic engagement manager at Softheon, a New York consulting firm that provides enrollment, billing, and other services to about 200 health insurers, many of which are bracing for enrollment losses. And enrollment could fall sharply. The Wakely Consulting Group estimates that the combination of expiring tax credits, the Trump law's new paperwork, and other requirements will result in ACA enrollment dropping by as much as 57%. According to KFF, insurers added premium increases of around 4% just to cover the expiration of the enhanced tax credits, which they fear will lead to lower enrollment. That would further raise costs, insurers say, because people who are less healthy are more likely to grit their teeth and reenroll, leaving insurers with a smaller, but sicker, pool of members. Less common in the filings submitted so far, but noticeable, are increases pegged to Trump administration tariffs, Cox said. "What they are assuming is tariffs will drive drug costs up significantly, with some saying that can have around a 3-percentage-point increase" in premiums as a result, she said. Consumers will learn their new premium prices only late in the fall, or when open enrollment for the ACA begins on Nov. 1 and they can start shopping around. Congress could still act, and discussions are ongoing, said insurance broker Brooker. Some lawmakers, he said, are consulting with the CBO about the fiscal and coverage effects of various scenarios that don't extend the subsidies as they currently exist but may offer a middle ground. One possibility involves allowing subsidies for families earning as much as five or six times the poverty level, he said. But any such effort will draw pushback. Some conservative think tanks, such as the Paragon Health Institute, say the more generous subsides led people to fudge their incomes to qualify and led to other types of fraud, such as brokers signing people up for ACA plans without authorization. But others note that many consumers — Democratic and Republican — have come to rely on the additional assistance. Not extending it could be risky politically. In 2024, 56% of ACA enrollees lived in Republican congressional districts, and 76% were in states won by Mr. Trump. Allowing the enhanced subsidies to expire could also reshape the market. Brooker said some people may drop coverage. Others will shift to plans with lower premiums but higher deductibles. One provision of Mr. Trump's new tax law allows people enrolled in either "bronze" or "catastrophic"-level ACA plans, which are usually the cheapest, to qualify for health savings accounts, which allow people to set aside money, tax-free, to cover health care costs. "Naturally, if rates do start going up the way we anticipate, there will be a migration to lower-cost options," Brooker said. KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.
CNN
4 days ago
- Health
- CNN
ACA insurers propose biggest premium hikes since 2018 as Trump policies take hold
Affordable Care Act insurers are proposing their steepest premium increases since 2018, driven in part by the looming expiration of Biden-era enhanced premium subsidies and by the Trump administration's tariffs, a new KFF analysis has found. Insurers are asking for a typical rate increase of 15% with more than a quarter proposing hikes of 20% or more. KFF, a nonpartisan health policy research group, looked at 105 Obamacare insurers in 19 states and the District of Columbia that have filed rates so far. Steep rate increases in 2018 were also fueled by Trump administration policies, which were focused on weakening the ACA during the president's first term after Republicans in Congress failed to repeal it in 2017. While rising health care costs account for about half of the coming year's proposed increases, two other forces under the control of President Donald Trump and congressional Republicans are also driving up rates, KFF found. The expiration of the enhanced ACA premium subsidies at the end of this year is prompting many insurers to hike rates by an additional 4%, on average. Insurers are concerned that the disappearance of this beefed-up assistance will prompt many, largely healthier consumers to drop their coverage — leaving sicker, costlier policyholders on the exchanges. Initially created by the Democrats' American Rescue Plan Act in 2021, the enhanced premium subsidies enable lower-income enrollees to sign up for coverage with very low or no monthly premiums. Also, middle-income Americans can qualify for assistance for the first time. The Biden administration repeatedly said the more generous subsidies allow the majority of enrollees to select plans that cost less than $10 a month. The enhanced subsidies helped drive Obamacare signups to a record 24 million people for 2025. Most enrollees qualify for subsidies, which greatly lower their monthly premium payments. But once the beefed-up assistance lapses, those payments are expected to spike by 75%, on average, KFF said. Trump and GOP lawmakers did not include an extension of the subsidies in their 'big, beautiful bill' and it remains to be seen whether they push for it in subsequent legislation. However, the clock is ticking since insurers are currently finalizing their rates, and the Obamacare federal and state exchanges need time to prepare for open enrollment, which starts on November 1. Several states are highlighting the looming loss of the enhanced subsidies as driving up insurers' proposed rates on their exchanges. In Maryland, for instance, carriers have requested an overall average premium change of 17.1%, the highest since 2019. If Congress extends the enhanced subsidies, the rate increases would be 7.9%, on average, according to the Maryland Insurance Administration, which is looking into creating a state-sponsored subsidy to offset some of the premium increases. Also, some insurers are pointing to the tariffs that the Trump administration has promised to impose on pharmaceutical imports, KFF said. Those that cite tariffs say the levies will add 3% to their premium proposals. The rate filings, however, do not mention specific impacts of the 'big, beautiful bill' because insurers generally had to submit their proposals prior to the bill being signed into law on July 4. Those that mention it point to the uncertainty it is causing, said Cynthia Cox, director of KFF's Program on the ACA. 'We're going to be watching over the next few weeks whether insurers come back and say, 'the big, beautiful bill passed, and here's how we think that might affect our premiums,'' she said. The filings also don't take into account the provisions in a rule that the Centers for Medicare and Medicaid Services finalized in late June that will make several changes to Obamacare, including shortening the open enrollment period, increasing verification requirements and limiting the ability of low-income Americans to sign up for coverage year-round. The measures are a 'mixed bag' for insurers in terms of how it might affect premiums, Cox said. One major insurer has already announced its departure from the Affordable Care Act in 2026. Aetna said in May that it would stop selling plans on the individual market because 'it became clear we would not be able to provide the same level of value we've offered in prior years,' the company said on its website. The insurer also left the Obamacare exchanges in 2018 but later returned. Insurers' 2026 rates are preliminary and are subject to change, particularly in states that run their own exchanges, where state regulators have more of a say in setting the final rates. The final rates should be published later this summer, and consumers will be able to view plan premiums shortly before open enrollment starts.
