Three shocks hit American healthcare

The roughly 160 million Americans with employer health insurance will face the largest premium increase in more than 20 years when they pick 2027 plans. Employer health plan costs are projected to rise 8 to 10% next year, double the average increase of the 2010s.

Marketplace premiums already jumped

In January 2026, the 24.3 million ACA Marketplace enrollees saw their after-subsidy premiums rise by an average of 114 percent. This followed Congress declining to renew enhanced premium tax credits in the One Big Beautiful Bill Act.

Marketplace enrollment fell sharply

After premiums spiked, enrollment fell 12 percent, from 21.8 million to 19.2 million. New Mexico was the only state where enrollment grew, after replacing federal subsidies with its own money.

Marketplace enrollees trading down plans

Those who stayed switched to skimpier coverage. The share of enrollees in the least generous bronze plans rose from 30 percent to 40 percent, and the average deductible rose by more than one thousand dollars to three thousand seven hundred eighty-six dollars.

Marketplace premiums hit new high

The average premium paid by marketplace enrollees hit one hundred seventy-eight dollars a month in 2026, fifty-eight percent higher than in 2025 and above the one hundred sixty-four dollars people paid in 2021, the last year before enhanced credits.

Employer plans rising fastest since 2003

For the roughly 160 million Americans with employer coverage, total costs will rise 8 to 10 percent next year, the largest increase since 2003. For a typical worker, this works out to roughly four hundred to five hundred dollars more next year.

Employers cutting coverage to hold costs

Many employers have made plans less generous to hold costs down. The share of large employers covering GLP-1s for obesity fell from 72 percent to 60 percent. Without these cuts, consulting firms estimate costs would have climbed another one to three percentage points.

Medicaid work requirement starts January

Starting January 1, 2027, the One Big Beautiful Bill Act requires the 44 states that expanded Medicaid to require adults to document 80 hours a month of work, school or community service. The CBO estimates this will push about 5.7 million people off Medicaid by 2034.

Work requirements may push off eligible people

When Arkansas imposed a work requirement in 2018, employment did not change. Instead, more than 18,000 people lost coverage within seven months, even though 95 percent either met the requirement or qualified for an exemption. The evidence suggests paperwork burden, not work capacity, drives coverage loss.

“more than 18,000 people lost coverage within seven months, even though 95% either met the requirement or qualified for an exemption”