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Expect increases in premiums for 2026 and prepare for no automatic renewal of Marketplace plans.
Health insurers who provide plans under the Affordable Care Act (ACA) are required to give the government a heads-up when they plan a significant rate increase. In Michigan, many are seeking double-digit increases for 2026. 15% rate increases are proposed for 121 of 251 individual plans and 50 of 573 small group plans, reports CBS News Detroit.
Among the reasons insurers cite for the increases are medical cost inflation, labor costs, tariffs on prescription drugs and imported medical devices and the expiration of enhanced premium tax credits that were available through the American Rescue Plan Act.
Below are more changes taking place for Marketplace health insurance plans that are part of the ACA.
Changes to rules on excess APTC
Officially, subsidies people receive for Marketplace health insurance premiums are called Advanced Premium Tax Credits (APTC). These subsidies are based on income.
Many small business owners and self-employed people have fluctuating income from year to year. Their APTC is adjusted according to actual income when they file income taxes. If they earn less than expected, the credit may be higher; if they earn more, the credit is lowered and the person pays back the some or all of the credit. Through the end of 2025, there are limits on how it needs to be paid back if one’s income is higher than expected. However, for 2026, there’s no cap on the how much they have to repay.
To avoid repayment of an APTC, estimate your income as accurately as possible when applying for financial help with a 2026 Marketplace plan.
Changes to Marketplace plans
If you or your employees purchase health insurance through the ACA Marketplace take note that there have been changes to enrollment and other elements of the program. Specifically:
- There’s no automatic renewal for those currently enrolled in Marketplace plans. In order to get coverage and apply for a subsidy, individuals are required to update income and other information annually.
- In 2026, subsidies are eliminated for those with over 400% of the federal poverty level (FPL). In 2025, the FPL for an individual is $15,650 and for a family of 4 it’s $32,150.
- For states that use HealthCare.gov, including Michigan, open enrollment for 2026 health insurance is from November 1, 2025, through January 15, 2026. (At the end of 2026, the enrollment period for 2027 plans will be shortened to about six weeks.)
- More Marketplace plans will make Health Savings Accounts available in 2026. These accounts allow enrollees to set aside pre-tax income for qualified medical expenses.
- The allowable limit on out-of-pocket costs is higher for Marketplace plans. For an individual this could be as much as $10,600. Depending on the plan you choose, this amount could be lower.
2026 tax credits still TBD
It’s unclear if Covid-era ACA subsidies will expire at the end of the year or if Congress will renew them. Those who rely on this help to cover part or all of their monthly premium could be in for sticker shock if the subsidies don’t get congressional approval—what they pay for coverage could rise by more than 75%.
Another unknown at the moment is the amount allowed in 2026 for tax credits to offset out-of-pocket expenses.
Ways to lower health insurance rates
There are a few ways to lower health insurance rates.
If you smoke, quit. Insurers are allowed to charge tobacco users up to 50% more than those who don’t use tobacco. While some states charge less than 50% or prohibit charging tobacco users, Michigan isn’t among them. You’ll pay higher health insurance premiums for using tobacco products, including e-cigarettes and vaping products.
Another way to minimize health insurance premiums is selecting a plan with a high deductible. This option is generally used by folks who seldom use medical services and don’t have chronic or major health concerns.
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Consumers business loans
Do you have business banking questions? Contact our knowledgeable commercial loan officers.