Benchmark marketplace plan prices are increasing nationwide just as enhanced tax credits are set to expire 

In 2021, Congressional Democrats voted to expand government subsidies for health insurance on the Affordable Care Act (ACA) exchanges.  

Previously, the subsidies had only been available to those making up to four times the federal poverty line, but the expansion meant the subsidies could now go to families making well into the low six figures. 

Congressional Democrats renewed the enhanced subsidies in 2023, and they are now scheduled to expire at the end of this year. 

Now, Washington finds itself in a crisis of its own making.  

Many Republicans don’t want to extend the enhanced subsidies, arguing they were supposed to be a temporary emergency measure to get Americans through the Covid pandemic. Democrats argue families were counting on these subsidies for 2026 and Congress can’t suddenly pull out the rug from them. 

They both have a point.  

It’s why Democrats and Republicans need to come together soon to find a solution that prevents premiums from skyrocketing for millions of Americans in just a couple of weeks and implements broader reforms that tackle the much deeper problem of rising health care costs.  

But it could be even worse than you expect. 

Just as the enhanced subsidies expire, ACA premiums are set to rise significantly in 2026. Those increases reflect the full sticker price of coverage, the total premium charged by insurers before any subsidies are applied. So, families are being asked to cover a much larger share of an already higher premium. That’s the double-whammy: higher prices, and fewer subsidies to help pay for them.

ACA Premiums On The Rise 

According to analysis from the Kaiser Family Foundation (KFF), the average monthly benchmark premium – the second-cheapest Silver plan used to calculate ACA subsidies – is projected to increase about 26 percent nationally, from $497 per month in 2025 to $625 in 2026. 

These increases are not the result of a single policy change or short-term anomaly. They reflect ongoing growth in underlying health care costs. Insurers point to higher hospital and physician prices, rising prescription drug spending, increased utilization, and administrative costs plaguing the system. When those costs rise, insurers respond by raising premiums. 

Because the ACA Marketplace largely mirrors the broader health care system, it is also affected by these trends. The result is higher benchmark premiums heading into 2026, even before the tax credits are taken into account. 

ACA Premiums, by State

Almost no one is safe from rising costs. Every state but Alaska will see higher premiums in 2026. While some states lucked out with single-digit increases, people in most of the country will see their premiums rise by 20-30% or more. At the extreme end, benchmark premiums in Arkansas are rising 69%.  

These differences are not driven by partisan politics. States across the political spectrum appear at both ends of the range. The states with the five highest increases are both red (Arkansas, Tennessee, Mississippi) and blue (Washington, Illinois).  

Instead, the variation reflects how the ACA benchmark is defined and how local insurance markets function. 

The benchmark plan is not a fixed product, it’s just whichever Silver-tier plan is the second-cheapest in a given area. So the price increases may reflect two different plans instead of one plan getting more expensive from year to year. This can happen when an insurance provider stops offering a certain plan or stops providing coverage in a certain state, or if providers change their pricing strategies and move plans to other metal tiers. When that happens, the benchmark premium can rise sharply even if average premiums across all plans move more gradually. 

Local market dynamics also play a role. Insurer competition, provider pricing power, and county-level cost differences all affect how premiums are set. Those county-level changes are then averaged up to the state level, producing the uneven pattern shown on the map. 

The Two-Track Solution  

Any solution to the impending ACA crisis will have to address both the immediate spike in costs for consumers as well as the underlying cost growth that has plagued the health care system.  

No Labels’ allies are working on both of these fronts. 

In the House, Reps. Josh Gottheimer and Jen Kiggans are leading a bipartisan push for immediate relief. Their bill, the CommonGround for Affordable Health Care Act, would extend the enhanced subsidies for another year and crack down on fraud and abuse in the system.  

At the same time, Senator Bill Cassidy is focusing on the drivers of health care costs. His approach – which he says is “not a Democratic plan, not a Republican plan, but an American plan” – would give money directly to patients in the form of Health Savings Accounts (HSAs) instead of to insurance companies. By giving patients more control and letting them shop around, Sen. Cassidy argues his plan would incentivize insurers to compete and lower premiums.  

Without a bridge, families face sudden and disruptive price shocks. Without structural reform, Washington will be back in the same place a few years from now – debating another temporary fix while premiums continue to climb. 

That is why solving the ACA affordability challenge requires both immediate action and a longer-term commitment to rein in health care costs at their source.