New York Approves 2026 Health Insurance Rate Increases Below Insurer Requests
New York has approved health insurance rate increases for 2026 for plans sold through the state-run Affordable Care Act marketplace. Individual plan premiums will rise by an average of 7.1%, while small-group plans will see a 13% increase. These approved rate hikes are notably below the rates initially requested by insurers, which were 13.5% for individuals and 24% for small groups. Rising medical costs, including inpatient hospital stays and accelerating drug prices, were cited by New York's Department of Financial Services as primary factors driving the increase.
The approved rates maintain a 1% profit margin for insurers, reflecting state efforts to limit profits amid inflationary pressures on consumers. Approximately one million New Yorkers enrolled in individual and small group plans will be affected by these changes. Rate adjustments vary significantly by insurer, with some, such as Excellus and IBHC, proposing increases up to nearly 21%, while others like Emblem (HIP) are offering rate reductions around 9%.
The Health Plan Association, representing insurers, highlighted that New York's high healthcare costs stem from substantial price increases demanded by providers and high pharmaceutical drug prices. Additional cost drivers mentioned include mandated benefits and health insurance taxes, which collectively add over $1,000 to average family coverage costs. The association also pointed to the expiration of enhanced premium tax credits at the end of the year as a factor influencing premium costs.
Employers nationwide are also expected to increase the financial burden on employees by raising deductibles, co-pays, or other out-of-pocket expenses, adding to the anticipated insurance cost pressures for working-age consumers in New York. Over recent years, from 2019 to 2023, individual plan rates in the state have increased by 31.4% overall, while small-group plan rates rose by 30.6%, underscoring a consistent trend of rising insurance costs.
The Health Plan Association urged Congress to extend premium tax credits to prevent significant cost hikes for New Yorkers and recommended that the governor reject additional state mandates that could further increase coverage costs. For detailed information on insurer-specific rate changes for 2026, the New York Department of Financial Services website provides regulatory documentation and updates.