Pennsylvania insurance commissioner Michael Humphreys has warned of steep health insurance premium hikes for 2026, attributing the increases to the impending expiration of federal enhanced premium tax credits and broader healthcare cost pressures.
In an interview with WPSU's Anne Danahy, Humphreys detailed proposed rate adjustments that could drive healthier individuals out of the market, exacerbating affordability challenges for remaining enrollees.
The rises are particularly acute for citizens using Pennie, Pennsylvania's state-based health insurance marketplace, where individuals and families who do not have coverage through an employer or other programs like Medicaid or Medicare can shop for and purchase health insurance plans.
Pennie was established under the Affordable Care Act to replace the federal HealthCare.gov platform in Pennsylvania, starting in 2020. Pennie connects consumers to private insurance plans and facilitates access to federal subsidies, such as premium tax credits, to help lower costs. It aims to improve affordability and streamline enrollment for Pennsylvanians seeking health coverage.
"We recently announced what proposed rates look like for 2026, and that's both in the individual market, so like the Pennie marketplace for individuals that don't get coverage through work may purchase coverage through Pennie to cover themselves or their family," Humphreys explained. "And that was right at around 19%, which is actually tied there with the national average. All states are seeing pretty significant rate increases proposed for next year."
The other impacted sector are small groups of under 50 employees, where the average proposed increase stands at 13%, higher than in recent years. Humphreys described the drivers as "almost a perfect storm of challenges.
Key among them is the sunset of enhanced premium tax credits (EPTCs) on December 31, 2025, unless extended by Congress. "The end of enhanced premium tax credits, which are currently set to expire on December 31st of 2025, if Congress does actually let them expire, that means a significant impact, even more than the 19% impact," he said.
"We anticipate rate increases of 82% or more for a lot of the enrollees on Pennie, just because that subsidy helped them pay for their insurance coverage."
Without subsidies, younger, healthier policyholders may drop coverage. "What we anticipate that meaning is that the young, healthier individuals are no longer going to find coverage affordable," Humphreys noted. “
And they're going to say, you know, I have school books, I have groceries that need to take priority, housing, and they're going to forego insurance." This shift would worsen the risk pool's "morbidity," prompting insurers to raise rates further in anticipation of a sicker enrollee base.
Real-world impacts vary by county and demographics, hitting pre-Medicare adults hardest. In Centre County, average annual subsidy losses could reach $2,400; Elk County, $2,700; and Clinton County, $2,000. Humphreys cited a stark example: "A 60-year-old couple in York, for example, $82,000 in annual income. They'll see their premium go from $7,000 a year to $35,000 in a year." Such jumps, representing over 30% of income, could force many to forgo insurance altogether.
Humphreys urged federal action. "That's why we, the Shapiro administration, myself, the Pennie executive director, have really been pushing for Congress to extend these tax credits for individuals into next year," he said. "People will soon be finding out when they go on Pennie to look at what their options look like, just how much the increases look."
With such uncertainty in the marketplace, it is no wonder that those younger, healthier citizens, in particular, are beginning to look to healthshare schemes as a possible alternative.
Although not regulated as insurance, healthshare plans can prove to be affordable options especially for people with generally good health.