ACA Marketplace Premiums 2018 to 2027
The graph above illustrates the year-on-year changes in Affordable Care Act marketplace premiums over the last ten years. The increases from 2023 through 2025 could reasonably be described as cost-of-living adjustments. It’s considerably harder to make that case for 2026 and 2027.
These increases reflect two interacting problems: the persistently rising cost of healthcare itself and the peculiar dynamics of health insurance, in which higher premiums can drive healthier customers out of the market, raising costs for those who remain.
This reinforces a point I have made before. Healthcare experiences structural pressures that produce persistent cost escalation, although economists disagree about whether these constitute a wage-price spiral in the conventional sense. Whatever we call it, healthcare has been a major source of upward pressure on Americans’ cost of living for decades.
Dave Schuler: the year-on-year changes in Affordable Care Act marketplace premiums over the last ten years. The increases from 2023 through 2025 could reasonably be described as cost-of-living adjustments. It’s considerably harder to make that case for 2026 and 2027.
“Structural pressures that produce persistent cost escalation” can explain the overall rise, but don’t explain the sudden jump in 2026. The primary factor was the expiration of premium tax credits, and the anticipated degradation of the insurance pool as young, generally healthier people drop out of the insurance market.
Health care is not a normal market. It doesnt always act the way people think it should though often it’s just people not properly understanding incentives. At present besides changes in the insurance market we are seeing persistent personnel changes post- covid driving some costs.
Steve