Reporting by Emily Barnes, New York State Team/Rockland-Westchester Journal News
New Yorkers who buy health insurance through the state-run Affordable Care Act marketplace may pay much more next year as double-digit percentage rate hikes are being proposed.
The proposed 2027 rates show health insurers in New York have requested that average New York health insurance rates increase by 20.7% for individuals in the Affordable Care Act (ACA) marketplace and related programs as well as an even higher proposed rate hike for small group plans of 25.7%.
This comes as the state ended coverage for 450,000 New Yorkers earlier this month through a rollback of its Essential Plan, which covers those who don’t have employer-sponsored plans and whose incomes are just above the cutoff to qualify for Medicaid.
Funded by the federal government, the state reduced that program’s coverage in response to funding cuts enacted last year by Republicans in Washington.
Looking at the larger picture, all Americans are at risk of higher rates next year. Insurers nationally are proposing a median ACA premium increase of 14% for 2027 plans, according to an analysis published by the Peterson-KFF Health System Tracker on July 8.
It’s the second-highest requested rate change since 2018, and if these rates are approved, consumers will have seen a more than one-third jump in typical premiums for insurers participating in ACA marketplaces over a two-year period.
Here’s what to know.
Why health insurance costs are spiking in New York
Health insurers in New York are pointing to increased drug costs and additional mandated benefits as reasons to increase rates for the more than 1 million New Yorkers currently enrolled in individual and small group plans through the state’s ACA health exchange, NY State of Health. Here are some specifics:
- Provider prices in New York are 22% higher than the national average, according to the Health Care Cost Institute.
- More than 870 drugs saw price increases in January.
- The number of mandated benefits also grew as state lawmakers approved several bills requiring the coverage of specific services and limits on cost sharing in this year’s legislative session.
- Taxes on health insurance, which total more than $7 billion annually, add to the cost of health insurance and increase the annual premium for the average family buying a policy in New York by more than $1,000.
Other factors include the Trump administration’s changes to marketplace rules as well as continued effects from the expiration of tax credits instituted during the former Biden administration, USA TODAY reported.
While the proposed rate hikes for next year have yet to be approved by the state Department of Financial Services, they range from a high of 52.1% through UnitedHealthcare of New York to a low of 1.4% for CDPHP.
The state agency has a history of reducing the rate increases sought by insurers, and final rates for next year will be approved in late August.
How much have New York health insurance rates increased in past years?
Rates for individual plans in 2026 increased by an average of 7.1% and small-group plan rates increased by 13%, according to state records.
And according to previous USA TODAY Network reporting, the average rates for individual plans from 2019 to 2023 increased by a total of 31.4% with an average yearly rise of around 6%. Small-group plans increased 30.6% over that same period.
For further details about specific health insurers’ proposed rate increases for 2027, visit the state regulatory agency’s website at dfs.ny.gov. You can also submit a comment about the requested increases through the agency’s online portal.
The agency also has a consumer hotline that is staffed Monday through Friday, from 8:30 a.m. to 4:30 p.m. at (800) 342-3736.
Are employer-provided health insurance costs also increasing?
Yes, employer-provided health insurance costs are expected to rise across the country. According to benefits consultant Mercer, nearly half of U.S. employers with 500 or more employees are planning on making changes to their medical plans that will raise out-of-pocket costs next year.
Emily Barnes covers state government for the USA Today Network-New York with a focus on how policy and laws impact New Yorkers’ taxes, communities and jobs. Follow her on Instagram or X @byemilybarnes. Get in touch at ebarnes@usatodayco.com.
This article originally appeared on Rockland/Westchester Journal News.
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