Health insurance companies to change previous approvals
HHS Secretaries Robert F. Kennedy and Dr. Mehmet Oz announced that major insurers have agreed to reduce and streamline their prior approvals
Consumers who purchase health insurance through the Affordable Care Act Marketplace could face double-digit rate hikes next year.
The insurer is planning a median premium increase of 15% on the 2026 plan, the largest increase in ACA insurance price since 2018, according to a Peterson-KFF Health System Tracker analysis issued on July 18th.
It also inescapable that many working-age consumers who have health insurance through their workplaces are covered. More than half of large employers expect to shift most of their insurance costs to employees and their families next year by increasing the deduction, out-of-pocket, or out-of-pocket requirements, according to benefits consultant Mercer.
KFF said the ACA insurance company cited factors such as health care inflation and the expiration of tax credits enacted during former President Joe Biden’s administration.
It remains unclear how President Donald Trump and Congressional Republican Tax Cuts and Expenditure Act will affect ACA health insurance fees next year, experts said.
Matt McGough, policy analyst for KFF’s program on ACA, said Trump’s tax cuts “created a lot of uncertainty.” “The insurance company didn’t know how to handle it.”
Millions of undisabled adults are projected to lose Medicaid coverage due to legal work or volunteer requirements, but the law also affects those who purchase ACA plans.
Trump’s laws and federal regulations end a special sign-up period for those who have achieved less than 150% of federal poverty levels – groups that have acquired registered profits in recent years. Registration perks allow low-income Americans to sign up for coverage all year round, making it easier for families to sign up.
The law also terminates automatic ACA registration renewal for consumers that is required to update income and other information each year.
Trump administration officials say the Biden administration’s registration policy against Medicaid and the Affordable Care Act allowed fraud and abuse.
In a July 17 news release, the Centers for Medicare & Medicaid Services said it had discovered that 2.8 million Americans may be enrolled in Medicaid or Children’s Health Insurance Program plans in multiple states, or that they have simultaneously registered with a Medicaid/CHIP plan and found that the ACA plan is subsidized. The agency said it has launched measures to ensure that multiple taxpayers are not simultaneously enrolled in insurance plans submitted by multiple taxpayers.
In a statement, US Secretary of Health and Human Services, Robert F. Kennedy Jr., said the Trump administration would “no longer tolerate waste, fraud and abuse at the expense of our most vulnerable citizens.”
Increased health costs, the end of the Covid era tax credits
Increased medical expenses are the biggest factor in increasing health insurance premiums.
Another important factor is Biden’s tax credit during the Covid-19 pandemic era, making the ACA plan cheaper for consumers, driving record registrations and expires at the end of the year. The nonpartisan Congressional Budget Office, which is estimated to be around 5 million people could lose their health insurance after the tax credit expires.
KFF said the expired tax credits will increase ACA consumers’ out-of-pocket premium payments by average 75% or more. Healthier enrollees are more likely to choose to leave insurance plans for groups of sick patients who need more medical care, McGough said.
A review of KFF, 105 ACA insurers in 19 states and Washington, DC, found that they are seeking a 10% to 20% rate hike for coverage next year. Another 28 insurers are seeking a rate hike of more than 28%.
State and federal insurance regulators will need to register for the proposed rate hike before finalizing this fall.
Most working-age Americans have health insurance through their spouse’s employer. These large employers will be happy to hand over the majority of their health insurance costs to workers and their families next year.
Mercer said 51% of large employers could or very likely shift costs to workers through higher deductions or maximum out-of-pocket costs. A year ago, 45% of employers were willing to let workers absorb a higher share of the health bill.
Employer health benefits costs are expected to rise by 6% in 2025 and could rise even faster in 2026. To control these increases in costs, employers are adjusting insurance plan options for workers and their families.
Early in the last decade, employers were reluctant to transfer significant health costs to workers due to the tight labor market. But more companies are willing to do so as health costs are rising faster than inflation, Umland said.
Businesses are also increasingly offering plans to encourage workers to care for them from a narrower network of doctors and hospitals who have negotiated insurance plans and discounts, Umland said.
