News Summary
California residents are bracing for a notable increase in health insurance premiums, with Covered California announcing a 10.3% average hike for 2026. This significant rise, the first double-digit increase since 2018, is driven by escalating health care costs and the looming end of enhanced federal subsidies. As nearly 1.7 million enrollees could face a staggering 66% increase without these subsidies, experts are urging legislative action to extend financial assistance. The anticipated changes are set to impact enrollment and costs in the state’s health insurance landscape.
California is set to experience a significant increase in health insurance premiums for 2026, as Covered California announced an average rate hike of 10.3%. This marks the first double-digit increase in premiums since 2018 and follows a 7.9% rise in 2025. Such adjustments have raised concerns among consumers and health policy experts alike, as they highlight mounting pressures on health care costs.
The substantial increase in premiums has been attributed to several factors, including rising health care expenses, the impending expiration of enhanced federal subsidies introduced during the COVID-19 pandemic, and general market uncertainties. Covered California’s Executive Director pointed to inflation and federal financial assistance expiry as significant contributors to the premium rise. Without the enhanced premium tax credits, nearly 1.7 million enrollees could face an additional 66% increase in monthly premiums.
The financial landscape for health insurance is increasingly precarious, especially since Congress did not allocate funding for these enhanced tax credits in recent legislative efforts. The omission notably impacts 90% of those enrolled in the Affordable Care Act, with California potentially losing around $2.1 billion in federal assistance for consumers if the enhanced credits are not renewed.
Health insurance agents report that clients are already expressing concerns about the anticipated higher premiums and reduced assistance. The state has attempted to cushion the impact of these increases by allocating $190 million to support subsidies for low-income residents, specifically those earning up to 150% of the federal poverty level. However, experts caution that this amount falls short of covering the expected shortfall.
According to estimates, approximately 600,000 individuals may drop their health coverage due to escalating costs and diminishing subsidies. This could lead to a less healthy enrollment pool and, in turn, an increase in premiums for those who remain insured. Covered California expects that most premium costs will continue to rise due to various factors, including drug tariffs, high medical device costs, and the widespread use of expensive pharmaceuticals. The overall national average premium increase is forecasted to be 20%, making California’s 10.3% increase seem relatively understated.
In 2026, eleven insurance companies will offer health plans statewide through Covered California, despite Aetna’s exit from the market, impacting around 21,000 enrollees. Open enrollment for new health insurance coverage will typically begin on November 1, offering consumers a chance to explore their options for the upcoming year.
Experts stress the urgency for Congress to take swift action to extend enhanced premium tax credits. Without this legislative support, younger and healthier individuals may opt out of purchasing health insurance altogether, thereby exacerbating premium costs for those who remain in the risk pool. Final rates for health insurance premiums in California will be confirmed later this year, with changes set to take effect on January 1, 2026.
Deeper Dive: News & Info About This Topic
- Almanac News: Covered California Health Insurance Costs
- San Francisco Chronicle: Covered California Premium Increase
- Sierra Sun Times: Covered California 2026 Rates and Plans
- ABC10: Covered California Premiums to Rise in 2026
- Google Search: Health Insurance California 2026
Author: STAFF HERE SAN DIEGO WRITER
SAN DIEGO STAFF WRITER The SAN DIEGO STAFF WRITER represents the experienced team at HERESanDiego.com, your go-to source for actionable local news and information in San Diego, San Diego 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 Comic-Con International, San Diego County Fair, and San Diego Pride Festival. Our coverage extends to key organizations like the San Diego Regional Chamber of Commerce and United Way of San Diego County, plus leading businesses in biotechnology, healthcare, and technology that power the local economy such as Qualcomm, Illumina, and Scripps Health. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
