Connecticut Health Insurers Propose Double-Digit 2026 Premium Hikes Amid Cost Pressures

Connecticut insurers have proposed significant premium increases for Affordable Care Act marketplace and small group health plans for 2026, with requested hikes ranging from 5.9% to 26.1%, averaging 17.1% for individuals and 13.1% for small groups. These increases could affect approximately 224,000 residents, including 70,000 small business employees, particularly impacting those who do not qualify for Medicare or Medicaid but rely on subsidized insurance. The proposed hikes come amid broader concerns about healthcare cost inflation and the potential expiration of enhanced federal subsidies by the end of 2025, which could further increase premiums by 3.5% to 6.8%. Loss of these subsidies may translate to a $1,700 average increase per enrollee, adding substantial financial pressure to middle-income families.

Healthcare providers, especially hospitals, cite inflation, rising supply chain and workforce costs, and government underpayment as key drivers pushing premiums upward. Hospitals warn that Medicaid eligibility changes could lead to a surge in uncompensated emergency care, shifting costs to private insurers and their customers. Insurers highlight additional challenges, such as increased demand for behavioral health services, rising drug and medical costs, and hospital consolidation leading to higher reimbursement rates. Pharmacy benefit managers note that while drug manufacturers set prices, most rebates negotiated are passed back to health plans, cautioning against state drug price controls that could provoke litigation.

The state's Office of Health Strategy projects 2026 insurer cost trends between 8% and 10%, exceeding Connecticut's newly established annual growth benchmark of 2.8% through 2030. The Insurance Commissioner described a "structural mismatch" between what families can afford and what the healthcare system demands. Lawmakers warn that these premium increases represent a financial shock akin to recent utility rate hikes, disproportionately affecting working-class families and small businesses.

These proposed premium increases, combined with diminished federal aid and ongoing cost pressures, risk pushing more residents into the uninsured population and exacerbating affordability challenges. Final rate decisions are expected in early December. The unfolding situation highlights ongoing tensions between insurers, providers, and pharmacy benefit managers regarding cost responsibility, underscoring the complex dynamics influencing health insurance pricing in Connecticut.