Insurers propose premium increases for ACA customers in Iowa

Iowa health insurance companies are proposing premium increases for Affordable Care Act customers in 2027, affecting thousands of Iowans. The proposal comes after insurers increased premiums for ACA-marketplace customers in 2026 by an average of 15.3% in Iowa.

The proposed premium increases come as enhanced tax credits, money from the federal government paid directly to insurers to lower health care costs for ACA consumers, are scaled back.

Natasha Murphy, director of health policy at the Center for American Progress, said insurance companies statewide that have proposed premium rate increases, some as high as double-digits, cited the expiration of enhanced tax credits and fewer customers as a reason for the price hikes.

"One of the big policy areas that insurers are flagging is the expiration of the enhanced tax credits," Murphy said. "You had several insurers cite that as one of the contributing factors as to why we're looking at double-digit increases for a certain plan, and that's mainly due to the fact that, as folks continue to get priced out of the market, the individuals who remain generally are sicker, and they know that they need to have insurance."

As of February, nearly a fifth of Iowans with ACA coverage dropped their insurance after the federal enhanced tax credits expired, according to data from KFF.

Murphy said that rising health care costs and higher prescription prices have also contributed to higher premiums.

Another factor Murphy attributed to premium spikes is a "market exit" among insurers who have historically provided ACA coverage. Murphy said Medica, a midwestern health insurance company, will no longer provide individual market coverage starting on Nov.1, which means nearly 4,000 Iowans will lose coverage.

"I think what's not certain is how much more are Iowans going to have to pay when they start shopping for coverage," Murphy said.

Murphy added that the changes could potentially lead to premium spikes for ACA customers in the coming years, including 2028.

Wellmark Blue Cross and Blue Shield, Iowa's largest insurer, has proposed an average 5% premium increase for ACA marketplace plans in 2027, following premium increases this year.

In a statement to the Iowa Capital Dispatch, a spokesperson for Wellmark Blue Cross and Blue Shield said the company raises premiums due to rising costs for medical care and prescription drugs.

"At Wellmark Blue Cross and Blue Shield, our decisions start with our members," the statement reads. "The cost of health care coverage matters, and even small changes have an impact. Each year, we review what drives those costs, including how health care is being used among our members and the impact of rising prices for services and prescriptions. We understand affordability is top of mind for our members, and it's a priority for us too. That's why we've worked hard to keep our proposed change among the lowest in the country and well below competing plans in Iowa. This result reflects years of disciplined work to control costs, improve efficiency and keep coverage affordable for the people we serve."

The spokesperson added that pharmacy and utilization costs rose more than 9% for ACA coverage in 2025, with overall medical costs increasing by 6%.

Wellmark says that affordability for customers matters to them, and the insurer provides tools and services to help clients select an insurance plan catered to them.

Amber Gustafson, a mother of three and an ACA recipient from Ankeny, said she experienced a 17% premium increase from Wellmark in 2026 and recently received a notice about the company's proposed 5% increase.

Gustafson, who is also a small business owner, said she and her husband had used private insurance prior to the ACA marketplace becoming available, and ACA coverage has been beneficial to her family.

"My second two (children) were born when we were carrying private health insurance, and at that time — because it was before the ACA and the changes to the law — our health insurance did not cover prenatal care or labor and delivery," Gustafson said.

Gustafson acknowledged that the ACA marketplace is not perfect, but the enhanced tax credits helped her family significantly when implemented in 2021.

"The ACA was life-changing, not just because of the care that it offered, but because of the changes that it made to the laws that required insurance to cover the things that we actually needed," Gustafson said.

Gustafson said she believes the expiration of enhanced tax credits have led to higher premiums, despite her family not qualifying for them.

"It is something that does ultimately affect every single person on the ACA, whether you get a tax credit or not," Gustafson said. "When we lost those tax credits, 2 million people dropped their coverage through the ACA, which is why these prices are going up."

Jill Kordick, a retired health administrator from Norwalk, said the first thing she did when receiving the letter from Wellmark was get out her calculator, adding she anticipates spending an additional $500 in her yearly budget due to the premium increase.

Kordick also said the language of the letter means her premium could be raised even higher.

"The language in the premium increase letter indicated an 'average of 5%'," Kordick said. "That leaves the door open for surprises."

Kordick criticized U.S. Rep. Ashley Hinson and U.S. Rep. Mariannette Miller-Meeks, describing the two Republicans as "fundamentally disconnected from Iowans."

"Representative Marinette Miller-Meeks and Hinson aren't listening to their constituents," Kordick said. "The hypocrisy of what they say and how they vote, especially as we enter into midterm elections, is very frustrating."

Kordick said she and other Warren County residents attempted, without success, to speak to Miller-Meeks in her Indianola office.

"I'm on a video from the Center for American Progress where I attempted to try to talk with her, and she walked away," Kordick said. "She didn't want to be recorded, and she fundamentally walked away."

Miller-Meeks's office did not respond to a request for comment. Hinson said in a statement to the Iowa Capital Dispatch that she is disheartened by premium increases and is advocating for bipartisan change in the U.S. health care system.

"The status quo of healthcare is a failure — it's way too expensive, premiums are too high, and not accessible enough," Hinson said. "I'm frustrated by the breakdown in Washington, D.C. — we need to be working together, in a bipartisan way, to lower costs and premiums for families, take on Big Pharma and big insurance companies that are jacking up costs and ensure all families can access affordable health care."