Health insurance premiums are going up: get ready to pay much more for medical costs in 2026

As open enrollment season approaches, Americans are bracing for another surge in healthcare costs — the biggest in more than a decade. Higher labor costs for healthcare workers, doctors and hospitals charging more, plus rising demand for care and new, expensive drugs are all pushing prices higher. And whether you get your coverage from your employer or on a healthcare exchange, you can expect to pay more.

How much are healthcare costs rising

Employers say the rise in costs this year is expected to be around 6.5%, but that is only after taking steps to limit the increase. Without those measures, the rise would be closer to 9%, according to Mercer.

One way employers will seek to cut costs is by raising deductibles and adding cost-sharing provisions, which means higher out-of-pocket costs for employees when they seek treatment. Of course, the actual impact on any employee will depend on where they work and how their employer decides to cope with rising costs.

In general, employees pay in proportion to the overall plan cost, meaning they should expect the deduction from their paycheck to rise by about 7% on average.

For people without employer insurance, the outlook is also bleak. Premiums for Affordable Care Act marketplace plans could soar if enhanced federal tax credits — introduced during the pandemic and set to expire at the end of 2025 — aren’t renewed. Analysts at KFF estimate out-of-pocket premiums could rise by as much as 75% for millions of enrollees.

Experts advise reviewing your options carefully during open enrollment — checking provider networks, prescription coverage, and out-of-pocket limits — to make sure you’re on the most cost-effective plan available.

How does a Health Savings Account work

Many employers also offer high-deductible health plans linked to a Health Savings Account (HSA), which allows employees to set aside pre-tax money for medical expenses. In 2026, individuals can contribute up to $4,400 and families up to $8,750, with an additional $1,000 catch-up contribution allowed for those aged 55 and older. Contributions, investment growth, and withdrawals for qualified healthcare costs are all tax-free, and unused funds roll over from year to year. After age 65, the money can even be withdrawn for non-medical expenses without penalty, though it becomes taxable income. For those who can afford to save, an HSA can ease the burden of rising out-of-pocket costs while doubling as a long-term financial cushion.

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