Montana health insurers propose double-digit rate increase for 2026

Montanans who purchase individual health insurance through the federal Marketplace could see the cost of their plans spike by double digits in 2026.

Blue Cross Blue Shield of Montana, one of the insurance companies that sells plans under the Affordable Care Act, is requesting an average rate increase of 28% for individuals. Mountain Health Cooperative is proposing a 25% jump.

The preliminary proposals released by federal health officials Aug. 1 indicate how Montana insurers are preparing for a shifting Affordable Care Act Marketplace beginning in the new year. In several states that released proposed rate changes earlier in the summer, insurers requested a median premium increase of 15%, according to a July analysis published by the Peterson Center on Healthcare and KFF.

For Blue Cross Blue Shield of Montana, the state's largest insurer, actual rate changes would vary significantly based on plan. The Blue Preferred plan, for example, is slated to increase by roughly 23%, while the price of the Blue Focus plan would rise by 33%.

In an attachment included in the federal government's information release, the company said the change is related to expected increases in medical and drug costs for members.

"The proposed rates reflect expected change in year over year medical service and prescription drug costs, which includes changes in reimbursement rates to providers, changes in expected utilization of services, the mix and intensity of services, and the introduction of new procedures and technologies," the document said.

By comparison, Blue Cross Blue Shield of Montana requested and received an approximately 5% average rate increase in the lead up to 2025.

National health care researchers and analysts have said the proposed rate increases for 2026 are linked to federal policy changes and general Marketplace uncertainty.

Pandemic-era enhanced premium tax credits that have helped make plans more affordable for consumers are slated to expire by the end of this year. Those subsidies were not continued under the GOP-backed budget resolution signed by President Donald Trump in early July. The shift in subsidies could increase consumer insurance costs by an average of 75%, according to the Peterson-KFF analysis.

Those out-of-pocket increases could cause many people to discontinue their health insurance plans through the Marketplace, according to Congressional budget analysts and national health care researchers. Even with the higher costs, enrollees with chronic and serious health conditions may remain insured, making the entire insured pool more expensive for insurers to cover.

A spokesperson for Blue Cross Blue Shield of Montana, Bryan Campen, said Friday that the expected end of enhanced federal subsidies influenced the company's proposed 2026 rates.

"Rate filings for 2026 assume enhanced federal premium tax credits will expire at the end of 2025 per [Centers for Medicaid & Medicare Services]. Plans are priced to reflect anticipated health care needs. The proposed rates for 2026 coverage include both new and current individual ACA-compliant plans and reflects industry-wide changes to the market," Campen said.

Campen also said the company "remains steadfast in its commitment to a stable health insurance market with competitive plan choices, as we have since the inception of the ACA."

Olivia Riutta, director of population health at the Montana Primary Care Association, said Montana consumers should be prepared to adjust their plans in response to the evolving landscape.

"With proposed rate increases and reduced tax credits, many Montanans will see higher health insurance costs as Open Enrollment begins on November 1. We're urging everyone to actively update their Marketplace application to explore all available options and find a plan that fits both their budget and health care needs," Riutta said in a Friday email to MTFP.

David Sanders, chief of staff for the Montana State Auditor's Office, which oversees and regulates insurance companies, confirmed to MTFP in a Friday phone call that the proposed rate increases should be considered preliminary estimates. The auditor's office has told federal authorities that it anticipates completing a review of the requested changes by Aug. 13.

"We're trying to ensure to the extent that we can that health insurance is accessible and affordable to the people across this state," Sanders said. "The first word in the Affordable Care Act is 'affordable.' And if we get to the point that it's not affordable to people, then that becomes a really big problem. So we do take very seriously our consumer protection responsibilities within this agency."

Consumers can provide comments about the rate review to the state auditor's office at csi.rates@mt.gov.