Middle-income Americans who don't qualify for subsidies face another year of crushing health insurance costs as insurers in the Affordable Care Act marketplace propose a median 14% premium increase for 2027, following a 20% spike this year. The analysis from healthcare research nonprofit KFF examined 77 insurers that have submitted publicly available rate filings.
The pattern is clear. Premiums jumped 20% in 2026, and now insurers are requesting another double-digit hike. For middle-class families earning too much to qualify for subsidies—households at or above 400% of the poverty level, roughly $63,000 for an individual or $129,000 for a family of four—the financial squeeze is intensifying.
What's Driving Costs Higher
Insurers cited mounting healthcare costs, federal regulatory changes, and the expiration of pandemic-era enhanced subsidies as the primary factors. Rising costs across the healthcare sector—from hospital visits to prescription drugs, workforce expenses, and sicker patients—topped the list of reasons. Overall inflation contributed to that pressure, driving prices higher across the entire economy.
The expiration of federal subsidies in January proved particularly consequential. When those tax credits ended, many plan costs skyrocketed. That prompted large swaths of enrollees to depart the marketplace, leaving sicker patients who carry higher risks and costs, and driving premiums higher. New state-by-state data posted by the Trump administration shows that the overall ACA marketplace shrunk by more than 2.5 million people over the past year, with some states seeing declines amounting to nearly a third of their enrollee population.
Some insurers added that federal regulatory changes contributed to their requests for higher premiums. New enrollment and eligibility requirements instituted by the Trump administration could affect the overall population of ACA enrollees, they said.
The Subsidy Divide
While most Americans in Obamacare still qualify for subsidies that protect them from paying the full premiums, middle-class enrollees who don't get those subsidies will face an especially stark increase in costs. Health insurers must send filings to regulators every year, explaining what they expect to see in premium rate changes for individual market health plans for the coming year. Next year's rates will be finalized later in the summer, but KFF's analysis looked at those in the ACA marketplace that already are public across 16 states and Washington, D.C., to get an early glimpse at what insurers are saying. The report measured insurers' premium increases as an average across all types of plans—bronze, silver, gold and platinum.
While Affordable Care Act enrollees make up less than 10% of the population, similar cost drivers are likely to make other private plans, including employer-sponsored plans, pricier too, according to KFF's analysis.
Market Exodus and Rising Risk
Georgetown University's Center on Health Insurance Reforms published an analysis of preliminary ACA insurer rate filings last month. Like KFF's, it projected double-digit premium increases in the marketplace next year.
Stacey Pogue, a senior research fellow at the center who authored the report, said the enrollees most affected by the rising premiums will be those who don't qualify for financial help. She said those people already saw the most significant increases to their premiums in 2026, with some of their premiums doubling or tripling.
"Those are the folks who kind of got a double whammy" this year, she said.
Pogue said the rate filings are demonstrating what many analysts had expected: that the expiration of enhanced tax credits would cause healthy Americans to flee the marketplace and leave a sicker patient population that relies more heavily on insurance.
"When the healthy people leave, the prices go up," she said. "The analysts all predicted that, and now that's what we're seeing."
The higher costs are contributing to Americans' existing worries about overall affordability, a concern that many voters say is front of mind with November's midterm elections looming. Federal lawmakers have proposed various policy changes to overhaul the expensive U.S. healthcare system, but no comprehensive legislation has amassed enough support to pass.
Why This Matters:
The ACA's design flaw is now fully exposed. When government subsidies artificially inflate enrollment, the market becomes dependent on that support. Remove it, and healthier consumers—the ones who make insurance pools financially viable—exit immediately. What remains is a sicker, more expensive population that drives premiums upward in a vicious cycle. Middle-income families earning just above subsidy thresholds are bearing the full weight of this market distortion, with premiums doubling or tripling in some cases. They're too "wealthy" for government help but not wealthy enough to absorb 20% annual increases. The 2.5 million people who've left the marketplace represent a rational response to unsustainable costs, but their departure destabilizes the risk pool further. Without fundamental reform that addresses underlying healthcare costs rather than masking them with subsidies, these premium spirals will continue punishing responsible middle-class families who play by the rules.