BAKERSFIELD, Calif. (KERO) — After years of relatively stable costs, health insurance premiums are on track to surge in 2026, leaving both employers and workers preparing for significantly higher bills.
The looming increases stem from the potential expiration of enhanced federal tax credits that have helped keep private health plan costs manageable for millions of Americans.
"When premiums rise, the question for employees is, well, is my employer going to pay the difference or is the employer going to pass on the difference to me. It can be one or the other, and it's often a mix of both," Jessica Altman said.
Altman, executive director of Covered California, explained that premiums have remained affordable thanks to federal tax credits that help people purchase private health plans.
"But those tax credits, unless Congress takes action in the coming weeks, are about to get much less generous," Altman said.
The recent federal government shutdown can partly be attributed to disagreements between Republicans and Democrats over these subsidies. Lawmakers on the left are pushing for a permanent extension of the enhanced tax credits, which are part of a program set to expire in 2026.
Charles Bacchi, president of the California Association of Health Plans, warned that consumers could face substantial premium increases when they renew their insurance.
"When they renew their insurance, they're going to be seeing increases as much as 10%, maybe even 18 to 20% on their insurance bill," Bacchi said.
The rising costs aren't solely about tax credits. Healthcare itself is becoming more expensive as inflation drives up wages and hospital costs. New, high-priced medications like weight-loss drugs are adding additional pressure to insurance premiums.
"We will cover them in limited circumstances if it's medically necessary, but they cost a lot of money," Bacchi said.
Both Altman and Bacchi noted that most people with employer-based coverage may be protected from the largest increases. However, those who purchase their own insurance — including independent contractors and small business owners — could feel the biggest impact.
"More than one in four farmers and agricultural workers get their health insurance from marketplaces, so that's another group of people who are highly vulnerable," Altman said.
"Unfortunately, the people who are going to have to pay more are the ones who can least afford to," Bacchi said.
For now, experts say costs will continue to climb, and the best way to ease the burden is to stay healthy and take advantage of available resources.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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