Double-digit health insurance increases expected

REGIONAL— Health insurance costs for many Minnesotans are expected to rise by double-digits in 2027, the second straight year of big increases in health insurance premiums. It’s a nationwide trend, fueled by inflation, labor shortages, and the effects of the phaseout of the enhanced premium tax credit last year.
For the roughly 400,000 Minnesotans who obtain health insurance through the MNsure program, either through the individual or small group markets, increases will range from 10-21 percent. That’s according to the Minnesota Department of Commerce, which released the final rates for next year on Oct. 1. Open enrollment for 2027 health insurance plans begins Nov. 1 for plans that begin Jan. 1.
The rates are proposed by the health insurance companies, which then must document the need for any requested rate hikes to Commerce officials. The final rates reflect reductions made through the state of Minnesota’s Premium Security Plan, a form of reinsurance adopted in 2017. Insurers had originally requested an average increase of 57.9 percent for next year, but the final rate increase averaged 17.4 percent after review and reinsurance.
The final rates do not necessarily reflect what consumers will actually pay for coverage. Premiums will vary due to factors including plan selection, geographic rating area, age, renewal date, and eligibility for subsidies. Tax credits and cost savings are still available for those who meet income and enrollment guidelines.
Beginning on Oct. 15, consumers can go directly to MNsure.org to explore their options for coverage. The online shop and compare tools allow consumers to choose between similar plans and premiums from Minnesota-approved carriers. They can also find free assistance from a certified health insurance broker or navigator through the online locater tools or call MNsure directly at 651-539-2099, or 855-366-7873 outside the Twin Cities.
“MNsure is the only place Minnesotans can shop and compare individual health plans and access tax credits that could lower the cost of their health insurance,” MNsure Chief Executive Officer Libby Caulum said. “The plans you find on MNsure.org all offer important consumer protections and provide essential health benefits that Minnesotans deserve, including preventive care, emergency services and outpatient care.”
Approximately 203,000 Minnesotans purchase individual coverage through the MNsure program, while another 185,000 Minnesotans receive group coverage through MNsure.
A national trend
Increased costs of medical care, prescription drugs, and reduced federal support for health care services have all combined to send overall health care costs spiraling across the country. According to a recent analysis by the Kaiser Family Foundation, or KFF, the higher premiums are being fueled by several factors, including an aging population, an increase in chronic conditions, expensive new treatments for a wide range of ailments, and the high cost of prescription drugs in the U.S., including rising demand for drugs like GLP-1s. Emerging factors, like tariffs, are impacting supply chains and drug pricing.
The phaseout of the enhanced premium tax credits due to passage of the One Big Beautiful Bill, is also impacting insurance rates, particularly in the individual market. The phaseout pushed premiums much higher for many middle-income individuals, many of whom opted to go without coverage. In Minnesota, about 17,000 individuals dropped coverage in 2026 after the sharp spike in rates.
According to the KFF, overall enrollment under the programs established by the Affordable Care Act fell from 21.8 million in 2025 to 19.2 million in early 2026, with further reductions projected. Younger adults, ages 18-34, comprised 46 percent of that decline, resulting in an older and less healthy insurance risk pool.
Nationally, health insurance premiums are increasing by about 15 percent for 2027, according to KFF.