For the millions of Americans who rely on the Affordable Care Act (ACA), also known as Obamacare, for health insurance, 2026 could bring about a difficult financial reality. Many insurers are requesting significant premium increases, which, if granted, could pose the biggest spike in years. These requests come on the heels of the expiration of the premium tax credits that helped keep costs manageable. This combination threatens to sharply raise what people pay for insurance or even force some to drop coverage altogether.

As Congress continues to debate decisions about extending those subsidies, individuals and families must evaluate their budgets to determine what their health insurance coverage is going to look like next year. It’s a moment of uncertainty, but preparation and awareness can make a real difference. Understanding what’s driving these changes may help you decide how to respond.

Why Are Premiums Poised to Rise in 2026?

Insurance companies participating in the Affordable Care Act have filed for rate increases of around 18% on average, marking what could be the largest increase in the program’s premiums since 2018. The rising cost of healthcare, driven by inflation, higher labor costs, increased hospital costs, and more expensive specialty medications, is driving premiums upward.

However, another driver has nothing to do with what takes place in hospitals or doctors’ offices. Instead, the premium tax credits that were expanded in recent years are set to expire at the end of 2025. Without those credits, the “sticker price” of healthcare will go up, and many households will see their monthly premiums more than double.

Finally, insurance companies say that they expect many healthy patients to drop coverage if the subsidies end, which raises concerns about adverse selection. In healthcare, adverse selection refers to what happens when there are fewer healthy people in the insurance “pool,” which leads to higher costs for remaining members. That expectation has already contributed to the larger rate hike requests, which compound the financial pressure on current enrollees.

Who Will Be Most Affected?

The impact of ACA premiums soaring upward will not be evenly distributed across all enrollees. Households that usually benefit the most from premium tax credits, usually low-and middle-income families, will feel the biggest squeeze. Some studies suggest that out-of-pocket premiums will go up by more than 100% once the enhanced tax credits are gone.

Older adults nearing retirement age but not yet eligible for Medicare are also at risk. Higher premiums may strain fixed or limited incomes, forcing difficult trade-offs between coverage and basic necessities. When considered together, it becomes obvious that the most vulnerable populations are those who stand to lose the most if ACA premiums skyrocket.

Even people who might still qualify for reduced subsidies will face increased costs. The rising sticker premium still pushes up their portion of the premium, and lower-income households may struggle if inflation and cost-of-living pressures continue to grow in other parts of the budget.

Beyond Subsidies: What Else is Driving the Premium Surge

Contrary to what you may have assumed, healthcare inflation isn’t just about premiums. Costs for medical services, hospital stays, labor, and especially high-priced specialty drugs have grown, and insurance companies pass those costs on to members.

Recent regulatory changes also factor into the rising costs of healthcare. New rules concerning marketplace integrity, compliance costs, and uncertainty surrounding federal policy have pushed insurance companies to take a more conservative approach.

Ultimately, insurance companies are for-profit entities, and when their costs go up, so too does the cost of their coverage. Unfortunately, these rising costs tend to impact people who have the hardest time affording them, which can create a widespread healthcare crisis.

What Congress Is Debating

Even if you don’t want to spend hours a day watching ongoing Congressional debates about the ACA and rising healthcare premiums, it’s important to know what is being debated in Washington. The heart of the debate is about whether to extend the enhanced premium tax credits that helped keep ACA marketplace plans affordable during the past several years. Senate Democrats, who have pushed for a multiyear extension to the premiums, argue that allowing these subsidies to expire would trigger a sharp rise in out-of-pocket premiums for millions of people, especially those who can afford it the least.

Meanwhile, Republican lawmakers are divided on the topic. Some have shown that they’re willing to extend the premiums for a short period, but only after agreeing to some changes to the ACA. Others have pointed out that the premiums were always supposed to be temporary and warned of rising federal spending if they continue. With deadlines looming, these disagreements have led to virtually no progress being made.

If Congress fails to act before the subsidies expire, insurers will finalize 2026 rates assuming fewer healthy enrollees remain in the pool, which could drive premiums even higher than the increases already proposed. The stakes are not just political, but also deeply practical.

What Should You Do?

If you currently receive your health insurance through the Affordable Care Act, this is certainly a troublesome time. The safest path forward is to assume that things are going to change drastically, so you should review your plan and premium tax credit eligibility as soon as open enrollment for 2026 begins.

If you are generally healthy, consider using Bronze or Silver plans, which come with higher deductibles and lower costs. If you’re eligible for Medicaid through your state, that’s certainly a viable option. If not, look into health insurance through your employer.

The next few weeks are pivotal to the future of healthcare in the United States. Being ahead of the game by creating a plan now can help you avoid stress in the future.