News Summary
California’s health insurance premiums are set to rise by an average of 10.3% in 2026, marking the first double-digit increase since 2018. This surge follows a 7.9% rise in 2025 and is attributed to rising healthcare costs and the expected end of federal subsidies. If Congress does not renew the enhanced premium tax credits, approximately 1.7 million enrollees may see their premiums skyrocket by 66%. The state risks losing $2.1 billion in federal assistance, impacting many residents reliant on the Affordable Care Act.
California is set to experience an average health insurance premium increase of 10.3% for the year 2026. This marks the first double-digit hike in premiums since 2018 and comes on the heels of a 7.9% increase in 2025. The premium rise is primarily linked to escalating healthcare costs, the impending expiration of enhanced federal subsidies, and persisting market uncertainties.
The Director of Covered California has indicated that rising inflation and the anticipated end of federal financial assistance are significant contributors to this increase. Approximately 1.7 million enrollees could face a further 66% spike in monthly premiums should Congress fail to renew enhanced premium tax credits that were established during the COVID-19 pandemic. This situation is expected to upend the financial stability of many residents who rely on the Affordable Care Act to maintain their health insurance coverage.
In recent legislative efforts, Congress did not allocate funding for the continuation of enhanced premium tax credits in President Donald Trump’s “One Big Beautiful Bill Act,” which would affect nearly 90% of those enrolled in the Affordable Care Act. If these tax credits are not reinstated by Congress, California risks losing around $2.1 billion in federal assistance, a crucial source of support for consumers in the state.
Health insurance agents are reporting that clients will likely face increased premiums and reduced financial assistance, leading to higher out-of-pocket expenses. State officials have taken steps to mitigate the impact for low-income individuals earning up to 150% of the federal poverty level by allocating $190 million to sustain subsidies. However, experts believe this funding will fall short of addressing the expected shortfall adequately.
As many as 600,000 individuals may drop their health coverage in response to rising costs and diminished subsidies, which could further inflate prices due to a smaller pool of healthier enrollees remaining in the system. Covered California is projecting that most premium costs will escalate significantly, exacerbated by factors such as tariffs on drugs, elevated medical device costs, and the frequent use of high-cost pharmaceuticals.
In comparison, the national average premium increase is forecasted to be 20%, illustrating that California’s increase, albeit substantial, is below the national average. Despite a challenging market environment, Covered California will retain 11 insurers offering plans statewide in 2026, although Aetna’s exit from the market will impact roughly 21,000 enrollees.
Open enrollment for health insurance coverage typically starts on November 1, providing a window for individuals and families to sign up for the forthcoming year. Experts warn that if younger and healthier individuals opt to forgo coverage, it could lead to higher premiums for the remaining insured population, creating a ripple effect within the healthcare marketplace.
The final rates for 2026 are expected to be confirmed later this year and will officially take effect on January 1, 2026. Given the implications of the premium increases and the potential loss of subsidies, Covered California emphasizes the urgency for Congress to extend enhanced premium tax credits to safeguard consumers from escalating healthcare costs.
Deeper Dive: News & Info About This Topic
- Almanac News: Covered California Premium Increase
- SF Chronicle: Covered California Premium Increase
- ABC10: Covered California Premiums to Rise
- Gold Rush Cam: Covered California Announces 2026 Rates
- Google Search: Covered California health insurance 2026
Author: STAFF HERE MISSION VIEJO WRITER
MISSION VIEJO STAFF WRITER The MISSION VIEJO STAFF WRITER represents the experienced team at HEREMissionViejo.com, your go-to source for actionable local news and information in Mission Viejo, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Oso Fit 5K Fun Run and Community Health Fair, Walk Against Drugs & Community Fair, and National Night Out. Our coverage extends to key organizations like the Mission Viejo Chamber of Commerce and Providence Mission Hospital Mission Viejo, plus leading businesses in retail and education that power the local economy such as The Shops at Mission Viejo, Capistrano Unified School District, and Amazon Delivery Station. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
