NAIC panel cites ‘instability,’ ACA turmoil as 2026 premium hikes loom

If there’s one thing that insurance likes, it’s stability. And the lack of stability in the health insurance space is driving premiums upward.

A panel at the National Association of Insurance Commissioners Summer Meeting discussed what’s behind double-digit premium increases proposed in the Affordable Care Act marketplace for 2026 and what is driving health care costs in the future.

Insurers are proposing the highest premium increases in five years, with a median premium hike of 15%, according to an analysis for the Peterson-KFF Health System Tracker covering 19 states and the District of Columbia.

Compare this to 2025, when health insurers had a median proposed increase of 7%.

“Instability is the name of the game right now. That’s the big problem we’re having,” said Brian Webb, NAIC director of life and health policy affairs. Some factors contributing to that instability, he said, include:

• The Trump administration’s Market Integrity Rule, focused on addressing fraud in the marketplace. The rule included verification processes on the federally facilitated marketplace, as well as a requirement that enrollees qualifying for $0 premiums must re-enroll or face a $5 premium.
• Enforcement of federal transparency rules, imposing requirements on health care providers and insurers.
• The continuing implementation of the No Surprises Act.
• Questions over enforcement of mental health parity rules.

Instability 'causing a lot of problems'

“All of this is causing a lot of problems in the marketplace,” he said.

In addition, Congress has not extended the enhanced premium tax credits that lowered ACA premiums for millions of Americans. Those tax credits are due to expire at the end of the year.

“This is a situation where there is tremendous instability in the marketplace, and insurance hates instability and uncertainty,” he said.

Insurers are assuming that enhanced tax credits will expire and that will have an effect on their premiums for 2026, said Cynthia Cox, KFF vice president and director of the program on the ACA. About 4% percentage points of the proposed premium increases are attributed to loss of enhanced tax credits, she said.

Faced with higher premiums, healthy consumers may drop coverage while those who are sicker will be likely to keep it, leading to an adverse impact on the risk pool, Cox said. In addition, those who drop coverage are more likely to delay or forgo medical care and are more likely to incur medical debt when they are forced to obtain care. They are also more likely to use the emergency room when they need care, and this will lead to an increase in uncompensated hospital care.

Other factors that Cox said are leading to increased premiums include:

• Increased medical spending.
• Increased use of GLP-1 drugs.
• Hospital price increases.
• The impact of tariffs on prescription drugs.

Small employers self-fund health plans

The fully insured markets are seeing some deterioration as more small employers move to self-funding their health plans, Cox said.

“We still see the same number of small employers offering health benefits but they are moving more toward self-funding and other types of arrangements,” she said.

Advances in medicine mean that “we are living in the age of miracles,” said J.P. Wieske, vice president of state affairs with Horizon Government Affairs, but those miracles aren’t cheap. He pointed to advances treatments for sickle cell disease and hemophilia that cost millions of dollars.

“We’re in an age of living longer and living better,” he said. “But we’re not there yet. Financing these treatments will be an issue.”

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Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].