Small businesses that offer ACA-compliant health plans are facing some steep premium hikes in 2026. Preliminary filings from hundreds of insurers point to a median proposed increase of about 11 percent nationwide, with some state-level data suggesting an even higher median of 12 percent. Although final numbers will be released later this year, the early signals show that small employers should brace for another costly renewal season.
Premium adjustments vary widely, ranging anywhere from slight decreases to increases of more than 30 percent. Most insurers are filing for hikes in the single to low double digits, but a noticeable share are seeking increases of 20 percent or more. Only a handful are actually projecting lower premiums.
The reasons behind these increases are familiar but significant. Insurers are projecting medical costs to rise close to 9 percent next year, reflecting both higher prices for hospital and physician services and greater use of care. General inflation, staffing shortages, and continued provider consolidation are also driving reimbursement rates upward. On top of that, the growth of expensive specialty medications—especially GLP-1 drugs—has become a key factor in pushing premiums higher. Some insurers are already planning to exclude these medications for weight-loss use in 2026 in an attempt to contain costs.
Another concern is shrinking enrollment in the small group market. As healthier groups and employees look for alternatives, the risk pool that remains tends to be older and costlier, which in turn pressures insurers to raise rates further. Several carriers have already scaled back their offerings or exited certain markets entirely.
For small employers, the reality is that providing health insurance is about to become more expensive. Many will need to rethink their benefit strategies, weigh changes in plan design or network structure, and prepare for difficult tradeoffs to keep coverage affordable. While these rate filings are still preliminary, the overall trend is clear: small business health insurance costs are heading upward in 2026.