New York approves increase for health insurance in 2027

Health insurance costs for thousands of New Yorkers will increase next year, but at a rate far less than requested by major insurers.

The state's Department of Financial Services last week approved new insurance rates for 2027 that include an average cost increase of 6% for individual market plans and 8% for those enrolled in small group market plans.

The final approved rates are less than half requested by major insurance companies, which were seeking a rate increase of 20.6% for individual market plans and 23.7% for small group insurers.

In a statement, the Department of Financial Services said the reduced rates will shave $1.6 billion off insurance costs next year compared to the original rates requested by insurance companies. That includes $1.25 billion for the estimated 630,000 enrolled in small group market plans that are available to small employers with less than 100 workers and an additional $324 million for the approximately 220,000 enrolled in individual market plans.

"The Department is focused on ensuring access to affordable health insurance and delivering meaningful cost savings for New Yorkers," the agency said in a statement.

The new rates come at a time when the growing cost of health care continues to be a top concern for many Americans after Congress last year let expire a series of pandemic-era premium subsidies that offset health insurance costs for millions of Americans.

A KFF poll released in April found that just under half of U.S. adults reported difficulty affording health care costs, with 3 in 10 reporting a family member with similar difficulties in the past year.

At the same time, hospital costs grew by 7.5% in 2025, more than double the rate of growth in hospital prices, according to the American Hospital Association.

Eric Linzer, president and CEO of the New York Health Plan Association, which represents insurance companies in the state, said the approved rates "fail to fully account" for major factors driving premium increases, including prices that hospitals and drug companies charge and new taxes on health insurance companies.

Health care spending in New York averages approximately 30% above the national average, according to a recent report by the Health Care Cost Institute, a nonprofit research group.

"Suppressing rates in the name of affordability does nothing to contain the cost of care. Instead, it ignores the ongoing escalation of provider and pharmaceutical prices," Linzer said. "With consumers already facing significant disruption due to federal actions, these rates make it increasingly challenging for health plans operating in the individual and small group markets and risk undermining the stability of the marketplace."

What rates were approved

Four companies had their requested rates for individual market plans slashed entirely, including the Latham-based Capital District Physicians' Health Plan, which requested a 1.4% increase. Emblem, IHBC and MetroPlus will also see no increase to their individual market plans next year under the approved rates.

Schenectady-based MVP Health Care requested and received a 10.7% rate increase for its individual market plan.

In the small-group market, Highmark is the only company that will see no rate increase next year. The Buffalo-based company had requested a 9.2% increase.

Those enrolled in the MVP Health Plan will see a 13.6% average increase, while those enrolled in the company's Health Service Corp. will see an average increase of 5.6%. MVP Health Care had requested a 19.6% and 12% rate increase for each respective plan.

Michelle Golden, a spokesperson for MVP Health Care, said the new rates "reflect the continued impact of rising medical and pharmacy costs," as well has greater utilization of care.

"We recognize that these same cost pressures are being felt throughout the health care system and are affecting individuals, families, and businesses across New York," Golden said. "As a regional, not-for-profit health plan, MVP remains focused on improving health outcomes, supporting access to care, and helping ease affordability challenges facing the communities we serve."

Those enrolled in the CDPHP small group plans will see an average rate increase of 9.7%, which is down from the company's requested 14.1%.

Barry Thornton II, the company's CEO, said in a statement that CDPHP is continuing to "navigate significant financial pressures" brought on by rising drug prices, hospital costs, taxes and fees, and changes to the Medicare Wage Index that the company has equated to an "unfunded mandate."

"In response, we are focused on managing administrative costs responsibly, improving operational efficiency, and investing in tools and technology that enhance the member experience," Thornton said in a statement. "We remain committed to delivering high-quality, affordable coverage while ensuring the long-term stability of our organization."

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