Covered California Health Insurance Will Cost More in 2026. Here’s What’s Behind the Double-Digit Increase

August 20, 2025

Covered California officials announced a 10. 3% average increase in health insurance premiums for 2024, the first double-digit hike since 2018. This increase stems from multiple factors, including annual healthcare cost growth (about 8%), the impending expiration of enhanced federal subsidies implemented during COVID-19, and market uncertainty.

Who is affected

Californians who get health insurance through Covered California marketplace
More than 90% of Affordable Care Act enrollees nationwide who use enhanced premium tax credits
Low-income Covered California members earning up to 150% of the federal poverty level
An estimated 600,000 people who might drop coverage due to affordability issues
Younger and healthier people who tend to forego coverage first when costs rise
Health insurance agents like Ariana Brill and their clients

What action is being taken

Covered California is implementing a 10.3% average premium increase for next year
California is spending $190 million to maintain subsidies for the lowest-income Covered California members
Health insurance agents are fielding calls from concerned clients about the upcoming increases
Some consumers are considering switching to less comprehensive, lower-cost plans

Why it matters

This represents the first double-digit rate increase since 2018
Without congressional action, California will lose approximately $2.1 billion in enhanced tax credits
Consumers will face a "double hit" of higher rates and reduced assistance
An estimated 600,000 people could drop coverage due to affordability concerns
When healthier people drop coverage, it creates a negative spiral of higher costs for those remaining enrolled
The 10.3% California increase is still below the national median increase of 18%
Rising healthcare costs affect broader affordability issues, with growing expenses for pharmaceuticals like Ozempic and Wegovy

What's next

No explicit next steps stated in the article

Read full article from source: The San Diego Voice & Viewpoint