Developed by Wakely Consulting Group, LLC

 

Michael Cohen, PhD, Principal and Senior Consultant

Michelle Anderson, FSA, MAAA, Director and Senior Consulting Actuary

Darren Johnson, FSA, MAAA, Consulting Actuary

 

Executive Summary | Introduction | Methodology and Assumptions | Key Findings

Changes to Total Out-of-Pocket Costs | Detailed Case Studies | Implications

Reliances | Appendices | Disclosures and Limitations

 

Executive Summary

Wakely was retained by the Association for Community Affiliated Plans (ACAP) to evaluate the potential effects of the expiration of the enhanced premium tax credits (ePTCs) as it relates to member out-of-pocket costs. This paper analyzes potential impacts on net premiums and cost sharing to individual market members as a result of the expiration in 2026.

The expiration of ePTCs, originally expanded under the American Rescue Plan Act (ARPA) and subsequently extended through the Inflation Reduction Act (IRA), would represent a significant shift in the ACA marketplace landscape. Without further legislative action, ePTCs are scheduled to sunset at the end of the 2025 plan year, leading to a material increase in net premiums for many members beginning in 2026.^[1] While prior research has focused on the net premium effects of ePTC expiration, fewer studies have focused on the potential member cost sharing implications of the expiration. We analyzed potential net premium and member cost sharing changes, in both a with and without ePTC environment for individuals of varying ages and health status across five different geographic locations. These dynamics are important for all parties to understand, both to optimize member purchasing decisions and to inform policymakers’ considerations.

Health plan premiums in the individual market^[2] vary based on factors such as age, geographic region, and plan generosity (level of cost-sharing protections), among others. Plans that require higher member cost-sharing tend to have lower premiums. Consequently, when consumers are faced with higher premiums, they will need to make a choice of 1) paying higher premiums but maintaining similar levels of cost sharing to their current coverage, 2) mitigating the premium increases they face by purchasing a cheaper plan but potentially having higher cost sharing costs down the line, or 3) forgoing coverage altogether. Consumers face difficult decisions between paying higher predictable premium costs, buying cheaper plans that are less generous and therefore are at risk for far higher cost-sharing costs, or declining coverage altogether. While previous studies have shown that members will pursue all three options^[3], fewer studies have focused on what buying down to less generous plans could mean for overall out-of-pocket expenses.  

Members that have predictable ongoing health expenses to treat conditions such as diabetes, or have known upcoming costs, such as prenatal care and delivery, are likely to face direct trade-offs between higher net premiums or higher out-of-pocket costs. For example, assume a lower income individual with diabetes, age 40, living in San Diego, is enrolled in a silver 94% cost-share reduction (CSR) plan in 2025. In 2026, if this individual stayed in a silver 94% CSR plan, their costs would rise by more than $700 annually due to the expiration of ePTCs and premium increases; if they “bought down” to a bronze plan instead, that premium cost increase would reduce to $70, but their expected cost sharing would increase by more than $5,000. In other words, buying down to a lower-priced metal tier would reduce their up-front costs, but increase their overall annual cost by thousands of dollars; regardless of their choice, they would face a minimum out-of-pocket increase of $700. Buy downs are financially risky, as the increase in cost sharing for members with even some claims quickly outweighs premium savings. This may result in a diabetic member or other individual with health care needs incurring higher cost sharing or not utilizing needed services due to out-of-pocket cost expenses they would have to pay.

Similarly, older members are also expected to see large increases in out-of-pocket costs, particularly members with incomes above the APTC cutoff of 400% of the Federal Poverty Level (FPL). For example, a 60-year-old San Diego resident with average health and an income at 401% FPL who is enrolled in a gold plan in 2025 would, if they stayed in a gold plan, face a projected cost increase for 2026 of almost $8,000 due to the expiration of ePTCs and rising premiums. Additionally, future premium increases in subsequent years would fully impact anyone over 400% FPL.

If ePTCs are not extended, consumers will be faced with difficult choices during open enrollment. Many will be tempted to avoid premium increases by purchasing less-generous plans. However, for the most part, only very young and healthy individuals have the potential to avoid large cost increases through these less-generous plans, as members with health conditions or expected costs who buy down will likely lose any savings through higher cost sharing.

 

Introduction

The American Rescue Plan Act (ARPA), enacted in March 2021, and the Inflation Reduction Act (IRA), enacted in August 2022, included a provision that temporarily expanded the size and scope of PTCs. The enhanced tax credits improved affordability, which in turn has driven Marketplace enrollment to record-high levels over the past few years–from about 12 million people in 2021 to 24 million in 2025.

Under current law, the ePTCs expire at the end of 2025. The Congressional Budget Office estimated that expiration of ePTCs would result in millions more uninsured people^[4] as increased net premiums would drive them to drop coverage. For those who do not drop coverage altogether, historically, when faced with an increase to net premium, members will often “buy down” – that is, purchase a less-generous plan to offset the net premium increase.^[5] As a result, they could then face higher cost sharing or the decision to forgo needed care.

For example, with ePTCs, an individual may find a gold plan affordable and choose to enroll. With a gold plan, a member pays approximately 20% of the cost of care when utilizing services. If that individual were to receive fewer premium tax credits, causing their gold plan to become unaffordable, they may buy down to a bronze plan for a similar net premium as they had previously paid for gold, but their cost-sharing would be closer to 40% of the cost of the health services they utilize. This could result in significant cost-sharing increases and lead to unintended consequences for individuals that utilize the health care system or get sick unexpectedly.

The table below shows the average share that individuals pay based on their metal level or silver cost-sharing reduction (CSR) plan (for lower income individuals 138% to 250% FPL) based on Federal AV de-minimis ranges.

 

Table 1: Average Cost Sharing by Metal Level and CSR

Metal and CSR	Member Cost Sharing
Platinum	10%
Gold	20%
Silver (CSR) 94	6%
Silver (CSR) 87	13%
Silver (CSR) 73	27%
Silver (standard)	30%
Bronze	40%
Catastrophic	>40%

This report explores the dynamics of individuals buying down to less-generous plans that feature higher cost shares. While members may reduce net premium increases by buying down to less-generous plans, if they incur medical costs, they will likely have higher cost sharing. Buying down to less-generous plans could thus result in higher out-of-pocket costs for some members.

This document has been prepared for the sole use of ACAP. Wakely understands that the report may be made public. This document contains the results, data, assumptions, and methods used in our analysis and satisfies the Actuarial Standard of Practice (ASOP) 41 reporting requirements. Using the information in this report for other purposes may not be appropriate.

The opinions and estimates included in this report are those of the authors and may not represent those of others at Wakely. Actual results will differ, potentially significantly, from the estimates in this report.

 

Methodology and Assumptions

With the end of ePTC, generally, members who receive advanced premium tax credits (APTCs) will experience a decrease in the amount of APTCs they would have otherwise received. Illustrative examples were generated to provide a realistic view of potential changes a member might see. Premium rates offered on the Exchange in the 2025 and 2026 individual market were estimated^[6] to analyze variances between premium levels at the different metal levels (bronze, silver, gold) and benchmark plan (second lowest-cost silver).^[7] Current maximum contribution requirements by income, which inform the amount of APTCs available to consumers based on current law can be seen in Appendix Table E.

To highlight the impacts of ePTC expiration, four sample individuals were selected based on age and health conditions, as defined by the ACA HHS risk adjustment Hierarchical Condition Category (HCC) model. The average claim level for each member was determined by using the Wakely ACA Database to provide realistic examples. Claims were not trended between years to allow for easier comparisons of out-of-pocket expenses under different plan choices^[8].

The following sample individuals were selected:

• 29 and healthy
• 35 and pregnant
• 30 with diabetes
• 60 and average health

The following counties were selected:

• Cumberland, ME
• East Baton Rouge Parish, LA
• Philadelphia, PA
• San Diego, CA
• Wake, NC

Estimated member cost-sharing and net premiums were calculated, assuming income levels at 138% of the Federal Poverty Level (FPL) and at 401% FPL.

The examples in the tables below show the differing premium costs for individuals assuming they enrolled in the lowest-cost gold, silver, and bronze plans in their respective county in both 2025 and 2026, as well as the cost-shifting impact of members buying down to a lower metal level. This comparison allows for realistic evaluation of a member’s total out-of-pocket cost (net premium and cost sharing) assuming some members choose to buy down to a lower actuarial value^[9] (AV) plan for net premium cost reductions compared to their current plan.

When a member buys down, they are selecting a plan with a lower premium cost (which is positive to the member) but also a lower actuarial value (which is net neutral or negative to the member depending on their utilization needs) – and hoping they do not incur enough claims such that the increase in cost sharing is greater than the premium reduction. Below, we explore what such a cost-shift could mean for different consumers based on their utilization patterns.

For this paper, cost-sharing was calculated assuming:

• A metal level AV equal to 80%/70%/60% for Gold/Silver/Bronze plans for members at the 401% FPL level
• A metal level AV equal to 80%/94%/60% for members at the 138% FPL level, assuming all silver members would receive a silver 94% CSR plan due to being under 150% FPL^[10]

The illustrative examples will differ pending final 2026 rates. The individual impacts will also vary based on differing ages, income levels, and geographic locations. However, we believe the direction of results and general magnitude will not differ and are illustrative of the cost-shifting that consumers choosing to buy down their coverage can expect to see.

 

Key Findings

Changes to Total Out-of-Pocket Costs

Table 2 below shows results for varying members displaying the change in total annual out-of-pocket cost (net premium and cost-sharing) from 2025 to 2026. The change from 2025 to 2026 includes preliminary rate increases, tax credit changes (assuming enhanced premium tax credit expiration in 2026), and any changes in cost-sharing if the individual moves plan metal levels. Table 2 shows the dynamics for members at 138% of FPL and enrolled in either a gold plan or a Silver 94% CSR plan in 2025.

As shown in Table 2:

• The first two value columns display the out-of-pocket cost differences (the total of net premium plus cost sharing) if the member stays in the same plan in 2026 (though shifts to the lowest-cost plan in that metal level if there is a change in which issuer offers the lowest premium between 2025 and 2026).
• The last two columns display the out-of-pocket difference of the members buying down from their gold/silver 94% plans to bronze plans. Because we are also modeling cost-sharing changes, we see that buying down does not often result in savings for members other than the healthy 29-year-old, as the increase in cost sharing more than offsets the premium savings.

 

Table 2: 138% FPL, Total Annual Out-of-Pocket Difference

County, State	Age and Condition:	2025 to 2026 Gold	2025 to 2026 Silver	2025 Gold to 2026 Bronze	2025 Silver to 2026 Bronze
San Diego, CA	29 and Healthy	$1,050	$720	($112)	$145
	35 and Pregnant	$1,078	$718	$3,269	$5,972
	40 with Diabetes	$1,093	$716	$2,727	$5,092
	60 and Average Health	$1,485	$684	$957	$2,686
East Baton Rouge Parish, LA	29 and Healthy	$809	$741	($276)	$0
	35 and Pregnant	$815	$741	$3,158	$5,882
	40 with Diabetes	$818	$741	$2,645	$5,032
	60 and Average Health	$900	$736	$910	$2,686
Cumberland, ME	29 and Healthy	$929	$735	($793)	$0
	35 and Pregnant	$946	$734	$2,594	$5,882
	40 with Diabetes	$955	$734	$2,054	$5,032
	60 and Average Health	$1,191	$721	($344)	$2,686
Wake, NC	29 and Healthy	$771	$663	($87)	$0
	35 and Pregnant	$773	$655	$3,365	$5,882
	40 with Diabetes	$774	$651	$2,861	$5,032
	60 and Average Health	$807	$545	$1,369	$2,686
Philadelphia, PA	29 and Healthy	$296	$600	$0	$0
	35 and Pregnant	$255	$586	$3,460	$5,882
	40 with Diabetes	$232	$579	$2,960	$5,032
	60 and Average Health	$0	$392	$1,580	$2,686

As the above table makes clear, at 138% FPL, members would still receive a large amount of APTC, which helps insulate them from the higher cost premium changes that members with higher incomes may experience. Many of these members will lose the $0 net premiums they had in 2025, which is likely to cause decreases in enrollment even if the magnitude of increase in dollars is relatively small.^[11] Buy downs are fraught here, as the increase in cost sharing for members with even some claims quickly outweighs premium savings. The next section, Detailed Case Studies, dives deeper into the dynamics of how net premiums and cost sharing change due to buy downs.

Note that for almost all members at 138% FPL, buying down to bronze from gold or silver 94% maintains a $0 net premium even with ePTC expiration – all increase in out-of-pocket expenses is due to cost sharing increases (see the last column of the above table). While net premium savings are present in a buy down, dropping from a silver CSR 94% AV plan to a bronze 60% AV plan causes a dramatic increase in cost sharing if members have even a moderate amount of claims. Members may buy down to maintain free coverage and end up paying significantly more on the back end if they have more claims than anticipated.

It’s important to note that different local conditions can produce different effects. For example, in San Diego members have a small premium increase in 2026 even after buying down to bronze plans, while in Philadelphia, members experience the lowest levels of year-over-year net premium changes, both of which are due to varying metal pricing practices between localities. For a full list of lowest premiums by metal level please see Appendix Table F.

The dynamic is different for members at 401% of FPL, as they would be just over the cut-off of being eligible for any premium tax credits if the enhanced premium tax credits are allowed to expire.

As shown in Table 3 below:

• For most, the primary difference in year-over-year cost sharing is simply the high 2025 to 2026 gross premium rate increases. This is because most consumers at this income level would not have received premium tax credits in either year, even in 2025 with the enhanced tax credits, due to their premium being lower than the applicable 8.5 percent of income threshold.
• The exception is for older members. The ACA permits 3-to-1 age rating for insurance premiums. That means the oldest enrollees pay three times more than an age 21-year-old with the same coverage, or in the case of a 60-year-old, 2.714 times more (See Appendix Table D for all member’s ARF factors by age). This bumps their premium over the threshold where they receive APTCs in 2025.^[12]
• Since the APTC calculation is not adjusted by age, the younger members do not receive any APTCs in 2025, while the 60-year-old member would lose APTC dollars if ePTCs expire. In all scenarios below, a 60-year-old of average health would see out-of-pocket increases of 4- to 5-figures, regardless of their plan’s AV metal tier.

 

Table 3: 401% FPL Total Out-of-Pocket Difference

County, State	Age and Condition:	2025 to 2026 Gold	2025 to 2026 Silver	2025 Gold to 2026 Bronze	2025 Silver to 2026 Bronze
San Diego, CA	29 and Healthy	$711	$636	($451)	$61
	35 and Pregnant	$776	$694	$2,967	$1,797
	40 with Diabetes	$955	$870	$2,588	$1,693
	60 and Average Health	$7,796	$7,615	$6,558	$7,010
East Baton Rouge Parish, LA	29 and Healthy	$1,335	$1,276	($449)	($164)
	35 and Pregnant	$1,930	$1,866	$3,443	$2,024
	40 with Diabetes	$2,254	$2,187	$3,177	$2,023
	60 and Average Health	$10,554	$10,412	$7,809	$7,710
Cumberland, ME	29 and Healthy	$1,803	$1,617	($182)	$620
	35 and Pregnant	$2,441	$2,239	$3,734	$2,879
	40 with Diabetes	$2,789	$2,577	$3,482	$2,917
	60 and Average Health	$11,690	$11,240	$8,456	$9,609
Wake, NC	29 and Healthy	$1,503	$1,458	($248)	($97)
	35 and Pregnant	$2,002	$1,954	$3,551	$1,985
	40 with Diabetes	$2,329	$2,279	$3,290	$1,982
	60 and Average Health	$10,714	$10,607	$8,049	$7,624
Philadelphia, PA	29 and Healthy	$399	$611	($760)	($852)
	35 and Pregnant	$436	$667	$2,630	$800
	40 with Diabetes	$456	$697	$2,092	$507
	60 and Average Health	$5,095	$5,609	$3,865	$2,852

Detailed Case Studies

Case Study: 60-Year-Old with Average Health

Table 4 and 5 below break the out-of-pocket costs into more detailed premium and cost sharing rows, as well as explicitly showing the calculations for buying down.

The examples in Table 4 are for an illustrative member:

• Age 60
• Average Health ($7,900 in annual allowed^[13] claims)
• 401% FPL
• Cumberland, ME

As noted previously, older members have generally received significant APTC dollars in 2025 even if they were over 400% FPL, and as such would be faced with large year-over-year premium increases if ePTC’s expire. That increase is further exacerbated by steep 2026 premium increases. Buying down to bronze does not fully offer financial relief.  Although the premium is significantly lower, the estimated increased cost sharing from moving from gold to bronze offsets much of the decrease. This example illustrates that older individuals who are over APTC thresholds may see a large impact from ePTC expiration regardless of whether they buy down.

 

Table 4: Detailed ePTC Impact Example – 401% FPL

2025 Metal[14]	2026 Metal	Field	2025	2026	$ Difference	% Difference
Gold	Gold	Annual Gross Premium	$15,223	$18,747	$3,524	23.2%
Gold	Gold	Annual Net Premium	$7,057	$18,747	$11,690	165.6%
Gold	Gold	Annual Cost Sharing	$1,580	$1,580	$0	0.0%
Gold	Gold	Total Out-of-Pocket Cost	$8,637	$20,327	$11,690	135.3%
Gold	Bronze	Annual Gross Premium	$15,223	$13,933	($1,290)	-8.5%
Gold	Bronze	Annual Net Premium	$7,057	$13,933	$6,876	97.4%
Gold	Bronze	Annual Cost Sharing	$1,580	$3,160	$1,580	100.0%
Gold	Bronze	Total Out-of-Pocket Cost	$8,637	$17,093	$8,456	97.9%

 

As shown in Table 5 below, if the member is instead at 138% FPL, the impact of ePTC expiration is somewhat muted (though remains large as a proportion of their income) as the member still receives APTCs. If the member enrolls in the lowest-cost silver plan, their total out-of-pocket cost rises from $474 in 2025 to $1,195 in 2026, a 152% increase, with annual net premium increases from $0 in 2025 to $721 in 2026. If the member instead chooses the lowest bronze plan, the net premium paid remains $0, but the potential cost sharing drives a large increase. Total out-of-pocket costs jump from $474 in 2025 to $3,160 in 2026, or a 567% increase. While the premium remains low, the increased cost sharing relative to the silver 94% plan makes total costs substantially higher.

 

Table 5: Detailed ePTC Impact Example –138% FPL

2025 Metal	2026 Metal	Field	2025	2026	$ Difference	% Difference
Silver 94	Silver 94	Annual Gross Premium	$13,279	$16,353	$3,074	23.2%
Silver 94	Silver 94	Annual Net Premium	$0	$721	$721	N/A
Silver 94	Silver 94	Annual Cost Sharing	$474	$474	$0	0.00%
Silver 94	Silver 94	Total Out-of-Pocket Cost	$474	$1,195	$721	152.0%
Silver 94	Bronze	Annual Gross Premium	$13,279	$13,933	$654	4.9%
Silver 94	Bronze	Annual Net Premium	$0	$0	$0	N/A
Silver 94	Bronze	Annual Cost Sharing	$474	$3,160	$2,686	566.7%
Silver 94	Bronze	Total Out-of-Pocket Cost	$474	$3,160	$2,686	566.7%

 

Case Study: Age 35 and Pregnant

As above, tables 6 and 7 below break the out-of-pocket costs into more detailed premium and cost-sharing rows, as well as showing the calculations for buying down.

The example in Table 6 is an illustrative member:

• Age 35
• Pregnant ($17,300 in annual allowed claims^[15])
• 401% FPL
• Wake, NC

And then in Table 7, we provide examples for a similar member, but at 138% FPL.

In both of these case studies, we see that for a member with even a moderate level of medical expenses, any benefit to buying down completely disappears. Notably, if the member made the choice to buy down before becoming pregnant – and thus before they realized they were likely to have substantial costs related to pregnancy and delivery – they would incur an extra $3,550 to $5,880 in annual out-of-pocket costs due to being in a bronze plan instead of a gold plan.

 

Table 6: Detailed ePTC Impact Example – 401% FPL

2025 Metal	2026 Metal	Field	2025	2026	$ Difference	% Difference
Gold	Gold	Annual Gross Premium	$5,589	$7,230	$1,641	29.4%
Gold	Gold	Annual Net Premium	$5,228	$7,230	$2,002	38.3%
Gold	Gold	Annual Cost Sharing	$3,460	$3,460	$0	0.0%
Gold	Gold	Total Out-of-Pocket Cost	$8,688	$10,690	$2,002	23.0%
Gold	Bronze	Annual Gross Premium	$5,589	$5,319	($270)	-4.8%
Gold	Bronze	Annual Net Premium	$5,228	$5,319	$91	1.7%
Gold	Bronze	Annual Cost Sharing	$3,460	$6,920	$3,460	100.0%
Gold	Bronze	Total Out-of-Pocket Cost	$8,688	$12,239	$3,551	40.9%

 

Table 7: Detailed ePTC Impact Example –138%

2025 Metal	2026 Metal	Field	2025	2026	$ Difference	% Difference
Silver 94	Silver 94	Annual Gross Premium	$5,425	$7,017	$1,593	29.4%
Silver 94	Silver 94	Annual Net Premium	$0	$655	$655	N/A
Silver 94	Silver 94	Annual Cost Sharing	$1,038	$1,038	$0	0.0%
Silver 94	Silver 94	Total Out-of-Pocket Cost	$1,038	$1,693	$655	63.1%
Silver 94	Bronze	Annual Gross Premium	$5,425	$5,319	($106)	-2.0%
Silver 94	Bronze	Annual Net Premium	$0	$0	$0	N/A
Silver 94	Bronze	Annual Cost Sharing	$1,038	$6,920	$5,882	566.7%
Silver 94	Bronze	Total Out-of-Pocket Cost	$1,038	$6,920	$5,882	566.7%

 

Implications

If ePTCs expire as currently scheduled, consumers will be forced to choose between four alternatives:

• Stay in their current plans with potentially far higher premiums;
• Buy down as a way of reducing the premium increase; or
• Leave the individual market for other coverage if eligible;
• Drop coverage entirely and become uninsured.

While buying down may negate some of the premium increases, it does come at a cost for many members. Buy downs can only help so much for consumers who have even moderate levels of medical expenses and may in fact instead lead to greater overall costs, as buying down to less rich plans (i.e., bronze, or potentially catastrophic given the latest CMS guidance^[16]) will come with far higher levels of cost sharing.

For people deciding to leave the individual market, they are likely to be healthier than the remaining members, which may cause a further increase in premium rates and exacerbate the issue of cost increases for many consumers. For members that have conditions such as diabetes or are pregnant, they are likely to face trade-offs between higher net premiums or higher out-of-pocket costs. Similarly, older members are also expected to see large increases in out-of-pocket costs. Only very young and healthy members have the potential to avoid large cost increases by purchasing less-generous plans. Consequently, most members will need to make complex shopping decisions as to what type of plan meets their needs both from a monthly premium perspective as well as taking into account medical expenses.

Given the complexity, it is unfortunately likely that many consumers will make suboptimal decisions that ultimately will cost them.

Reliances

Wakely relied on public source rate data available for 2025 and public rate increase data for 2026 to generate realistic examples of individual market impacts.

We relied on the Wakely ACA Database (WACA) to determine average costs for the example members. WACA is an aggregated database based on de-identified EDGE Server input and output files (including enrollment, claims, and pharmacy data) from the 2022 benefit year, submitted through April 2023.

• Results will be affected by issuer-specific data management. Omitted claims, erroneously coded claims, erroneous enrollment records, and other data issues may not reflect actual ACA cost and diagnosis experience.
• A subset of issuers nationwide submitted data to the database. We believe the database represents a fair cross-section of nationwide experience, but limitations in this regard will affect results.
• 2022 experience will still exhibit significant impacts from the COVID-19 pandemic, including but not limited to:
• Deferred care from members and providers avoiding medically discretionary visits
• Lower coding trend from deferred care and other disruptions
• Significant claims related to COVID-19 including inpatient admissions, vaccine administration, and testing administration and materials.
• Ongoing impacts to morbidity from post-COVID Complications

The information contained in this report is neither intended nor appropriate or sufficiently detailed to use in product pricing in any line of business.

Current subsidy calculations reflect status quo. There are numerous proposed changes to the ACA subsidy structure that have not been reflected within these key findings and only the change to the benchmark plan was illustrated.

 

Appendices

Table A: 2026 Federal Standard Plan Designs^[17]

Metal Tier	Expanded Bronze	Standard Silver	Silver 73 CSR	Silver 87 CSR	Silver 94 CSR	Gold	Platinum
Actuarial Value (% of Cost Insurer Pays)	64.12%	70.01%	73.07%	87.04%	94.11%	78.04%	88.03%
Deductible	$7,500	$6,000	$3,000	$700	$0	$2,000	$0
Annual Limitation on Cost Sharing	$10,000	$8,900	$7,400	$3,300	$2,200	$8,200	$5,200
Coinsurance Rate	50%	40%	40%	30%	25%	25%	Copay Only

 

Table B: 100% of Federal Poverty Level for 2025 and 2026

Household Size	2025	2026
1	$15,060	$15,650
2	$20,440	$21,150
3	$25,820	$26,650
4	$31,200	$32,150
5	$36,580	$37,650
6	$41,960	$43,150
7	$47,340	$48,650
8	$52,720	$54,150
more	add $5,500 each	add $5,500 each

 

Table C: Sample Members Chosen

Age and Condition	Condition Definition	Annual Allowed Claims[18]
29 and Healthy	No Hierarchical Condition Categories (HCCs)	$0
35 and Pregnant	HCC209 (Pregnancy with Delivery, With No or Minor Complications)	$17,300
40 with Diabetes	G01 (HCC Grouping 1[19]) Diabetes	$14,800
60 and Average Health	No HCC related criteria applied	$7,900

 

Table D: ACA Allowable Rating Factor by Example Member

Example Member	Age	ARF
29 and Healthy	29	1.119
35 and Pregnant	35	1.222
40 with Diabetes	40	1.278
60 and Average Health	60	2.714

 

Table E: 2025^[20] and 2026^[21] APTC Percentages

	Household Income Percentage of Federal Poverty Line
	with ePTC		without ePTC
FPL Level	Initial %	Final %	Initial %	Final %
Less than 133%	0.00%	0.00%	2.10%	2.10%
At least 133% but less than 150%	0.00%	0.00%	3.14%	4.19%
At least 150% but less than 200%	0.00%	2.00%	4.19%	6.60%
At least 200% but less than 250%	2.00%	4.00%	6.60%	8.44%
At least 250% but less than 300%	4.00%	6.00%	8.44%	9.96%
At least 300% but not more than 400%	6.00%	8.50%	9.96%	9.96%
Over 400%	8.50%	8.50%	N/A	N/A

 

Table F: Age 40 Rates for 2025 and 2026, Selected Counties

County, State Metal 2025 Price 2026 Price San Diego, CA Lowest Bronze $391.76 $421.21 Lowest Silver $415.40 $475.92 Second Lowest Silver $439.71 $478.32 Lowest Gold $464.15 $531.78 East Baton Rouge Parish, LA Lowest Bronze $383.50 $472.13 Lowest Silver $494.24 $609.15 Second Lowest Silver $495.10 $609.52 Lowest Gold $521.38 $641.87 Cumberland, ME Lowest Bronze $443.96 $546.74 Lowest Silver $521.08 $641.71 Second Lowest Silver $521.86 $642.67 Lowest Gold $597.36 $735.65 Wake, NC Lowest Bronze $358.34 $463.55 Lowest Silver $472.78 $611.59 Second Lowest Silver $478.85 $619.44 Lowest Gold $487.12 $630.14 Philadelphia, PA Lowest Bronze $249.91 $267.53 Lowest Silver $348.60 $406.72 Second Lowest Silver $363.42 $420.57 Lowest Gold $339.86 $377.82

 

Disclosures and Limitations

Responsible Actuary. Michelle Anderson and Darren Johnson are the actuaries responsible for this communication. They are both a Members of the American Academy of Actuaries and a Fellows of the Society of Actuaries. They meet the Qualification Standards of the American Academy of Actuaries to issue this report. Michael Cohen, PhD, also contributed to this report.

Intended Users. This information has been prepared for the sole use of the Association of Community Affiliated Plans (ACAP) and cannot be distributed to or relied on by any third party without the prior written permission of Wakely. Wakely understands that the report may be made public. Distribution to such parties should be made in its entirety and should be evaluated only by qualified users. The parties receiving this report should retain their actuarial experts in interpreting results.

Risks and Uncertainties. The illustrative examples included in this analysis are inherently uncertain. Users of the results should be qualified to use it and understand the results and the inherent uncertainty. Actual results will vary from our examples, and impacts will vary by region. Wakely does not warrant or guarantee the projected values included in the analysis. It is the responsibility of the organization receiving this output to review the assumptions carefully and notify Wakely of any potential concerns.

Conflict of Interest. We are financially independent and free from conflict concerning all matters related to performing the actuarial services underlying these analyses. In addition, Wakely is organizationally and financially independent to ACAP.

Data and Reliance. We have relied on others for data and assumptions used in the assignment. We have reviewed the data for reasonableness but have not performed any independent audit or otherwise verified the accuracy of the data/information. If the underlying information is incomplete or inaccurate, our estimates may be impacted, potentially significantly.

Subsequent Events. Subsequent events may impact the findings in this report. Changes in state policy, economic conditions, federal legislation, and other factors and emerging data could result in material changes to this analysis.

Contents of Actuarial Report. This document and the supporting exhibits/files constitute the entirety of the actuarial report and supersede any previous communications on the project.

Deviations from ASOPs. Wakely completed the analyses using sound actuarial practice. To the best of our knowledge, the report and methods used in the analyses comply with the appropriate ASOPs with no known deviations. A summary of ASOP compliance is listed below:

ASOP No. 23, Data Quality

ASOP No. 41, Actuarial Communication

 

 

[1]For example, an Urban Institute analysis noted that with ePTCs, household net premiums would be 50 to 100 percent lower compared to a world without ePTC. https://www.urban.org/sites/default/files/2024-06/Who_Benefits_from_Enhanced_Premium_Tax_Credits_in_the_Marketplace.pdf

[2] For purposes of this paper, the individual market refers only to plans that meet the market reform requirements such as actuarial value and exclude grandfather and grandmother plans.

[3] The Urban Institute also estimated that as a result of the higher net premiums, consumers are far less likely to purchase plans that have lower cost sharing (gold) and more likely to purchase less generous plans (bronze/silver). https://www.urban.org/sites/default/files/2024-06/Who_Benefits_from_Enhanced_Premium_Tax_Credits_in_the_Marketplace.pdf

[4] Congressional Budget Office. Re: Estimated Effects on the Number of Uninsured People in 2034 Resulting from Policies Incorporated within CBO’s Baseline Projections and H.R. 1, the One Big Beautiful Bill Act. June 4, 2025. Available at: https://www.cbo.gov/system/files/2025-06/Wyden-Pallone-Neal_Letter_6-4-25.pdf.

[5] https://www.kff.org/affordable-care-act/congressional-district-interactive-map-how-much-will-aca-premium-payments-rise-if-enhanced-subsidies-expire/

[6] The rates were summarized using a combination of 2025 Rates Public Use Files and published issuer level 2026 interim rate increases from https://ratereview.healthcare.gov/

[7] The interim rates are not final and will change. The results presented in this analysis are illustrative yet realistic. Actual impacts should be analyzed when final rates are published.

[8] These individuals represent sample experiences that can be compared in the 2025 and 2026 environments – it is unlikely a member would have the exact same claims experience year over year, and premiums would also vary as their age increased by 1.

[9] Note that actuarial value is the percentage of a members total health claims that the plan covers versus what the member pays for in cost sharing – deductible, copays, coinsurance; it is another way describing the generosity of a plan.

[10] Average deductible, maximum out-of-pocket, and coinsurance rates by plan design can be seen in Appendix Table 1 for the 2026 Federal Standard Plan Designs.

[11] https://www.brookings.edu/articles/eliminating-small-marketplace-premiums-could-meaningfully-increase-insurance-coverage/

[12] In technical terms, the premium cost does not exceed 8.5% of 401% of the FPL in 2025 and, thus, the members do not benefit from ePTCs in 2025. In 2026, these members are ineligible for premium subsidies simply based on their income, even if premiums exceeded 8.5% of their income

[13] Allowed costs refers to the sum total of both plan liability costs and member cost sharing – total healthcare expenditures for the member in the year. This amount was determined using our WACA database to identify the average 60 year old member’s annual claims. See Appendix C for more detail.

[14] Assume member enrolls in lowest cost plan in each metal in Table 4-7

[15] This amount was determined using our WACA database to identify the average 35 year old pregnant member’s annual claims. See Appendix C for more detail.

[16] https://www.cms.gov/files/document/guidance-hardship-exemptions.pdf

[17] https://www.govinfo.gov/content/pkg/FR-2025-01-15/pdf/2025-00640.pdf

[18] Allowed costs refers to the sum total of plan liability costs and member cost sharing costs. This was determined using our WACA data.

[19] The diabetes condition was defined as including multiple HCCs (i.e., HCC Grouping 1) to align with the ACA risk adjustment definition. Please see https://www.cms.gov/files/document/cy2025-diy-instructions-07232025.pdf

[20] https://www.irs.gov/pub/irs-drop/rp-24-35.pdf

[21] https://www.irs.gov/pub/irs-drop/rp-25-25.pdf