New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Largest Increase Ever From Top Insurers. Will University of Chicago Employees Be Affected?

'With ACA premiums expected to rise in 2026, University of Chicago employees should compare marketplace and employer-related options early, model net costs with and without current subsidies, and coordinate with HR and a qualified tax professional for decisions suited to their situation.' — Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.

'With ACA marketplace premiums expected to climb in 2026, University of Chicago employees should compare employer and marketplace options early, estimate net costs under both current and lapsed subsidy scenarios, and coordinate with HR and a qualified tax professional to align coverage with their budget.' — Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article we will discuss:
1. The expected premium increases for ACA marketplace plans in 2026 and their potential impact on University of Chicago employees and retirees.
2. The major national insurers and states with the largest requested rate hikes.
3. The primary economic, legislative, and industry factors driving these increases.
In 2026, health insurance rates for plans purchased through the Affordable Care Act (ACA) marketplace are expected to surge, with several insurers requesting increases exceeding 60%. ¹ For University of Chicago employees and retirees using ACA coverage, this could mean a substantial rise in health care costs. State insurance filings and industry publications point to higher medical expenses, the potential end of enhanced federal premium subsidies, and significant rate-hike proposals from major insurers as key drivers of the increase.

According to KFF’s analyses, the vast majority of marketplace enrollees receive premium tax credits, and if the enhanced credits expire after 2025, average out-of-pocket premium payments for subsidized enrollees could rise by more than 75% in 2026. ¹ As of January 2025, 24.2 million people selected 2025 marketplace coverage, ² and about 93% of marketplace enrollees rely on premium tax credits. ³ KFF also reports that requested premium increases for 2026 are the largest in years, with most proposals falling between roughly 12% and 27% and a median of 18% across reviewed filings. ⁴

Top 10 States With the Largest Requested Premium Increases for 2026:
- New York: UnitedHealthcare requesting up to +66.4% (individual market).
- Arkansas: QualChoice +54.4% , Ambetter (Celtic) +42.5% , statewide average +36.1% .
- Colorado: Western Slope ~+38.8% ; statewide average +28.4% . Rocky Mountain HMO +36.4% , Cigna +29.4% , Anthem +33.6% , Kaiser +15.3% .
- Florida: Molina ~+41% , Florida Blue +27% , Centene Venture +18.73%
- Maine: Anthem (revised) +24.8% ; statewide weighted average +25.9% .
- Washington: 14 insurers; requested average +21.2% .
- Vermont: BCBS Vermont +23.3% .
- Maryland: Requested statewide average +17.1% (individual market).
- Illinois: BCBS Illinois +27% .
- Texas: BCBS Texas +21% .
Major National Insurers and Their 2026 Requests:
- UnitedHealthcare (UnitedHealth Group): Up to +66.4% in New York.
- Elevance Health (Anthem BCBS): +33.6% in Colorado; +24.8% in Maine.
- Kaiser Permanente: +15.3% in Colorado (individual market).
- Centene Corporation (Ambetter/Celtic): +42.5% in Arkansas; +18.73% in Florida.
- Cigna Healthcare: +29.4% in Colorado.
- Molina Healthcare: ~41% in Florida.
- HCSC (BCBS IL, TX): +27% in Illinois; +21% in Texas.
- GuideWell (Florida Blue): +27% in Florida.
- CareFirst BlueCross BlueShield: Maryland requested statewide average +17.1% .
- CVS Health/Aetna: Withdrawing ACA marketplace plans in 17 states in 2026, affecting ~1 million members.
Key Factors Driving the Increases:
- Loss of Enhanced Premium Subsidies: The American Rescue Plan and Inflation Reduction Act extended ACA subsidies through 2025. Without renewal, subsidized enrollees could see sharp increases in monthly premiums beginning in 2026 (KFF estimates more than a 75% jump in average out-of-pocket premiums for subsidized enrollees if the enhancements lapse). ¹
- Medical Cost Inflation: Leading consultancies report elevated medical cost trends heading into 2026—about 7.5% in the individual market and 8.5% in the group market ⁵ —driven by hospital/physician services and prescription drugs.
- Regulatory Shifts: Market rules and state laws have influenced filings. For example, analysts note federal policy changes (e.g., the Marketplace Integrity rule) as a factor cited in filings, adding operational uncertainty for vertically integrated insurers/PBMs.

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Sources:

1. KFF, Health System Tracker. ' How much and why ACA Marketplace premiums are going up in 2026 ,' by J. Ortaliza, M. McGough, K. Vu, I. Telesford, S. Rakshit, E. Wager, L. Cotter, C. Cox. 6 Aug. 2026.

2. CMS.gov. ' Over 24 Million Consumers Selected Affordable Health Coverage in ACA Marketplace for 2025 .' 17 Jan. 2025.

3. The Commonwealth Fund. ' Proposed Rule Will Make Consumers Pay More for Health Insurance and Care in ACA Marketplaces ,' by Sara Collins. 7 May 2025.

4. Fierce Healthcare. ' KFF Analysis finds a median ACA premium hike of 18% for 2026 ,' by Paige Minemyer. 8 Aug. 2025.

5. PwC Health Research Institute. Medical Cost Trend: Behind the Numbers 2026 . PwC , 16 July 2025, https://www.pwc.com/us/en/industries/health-industries/library/behind-the-numbers.html .

Other reources:

1. New York State Department of Financial Services. “Summary of 2026 Requested Rate Actions.” DFS Portal , 2 June 2025, https://myportal.dfs.ny.gov/web/prior-approval/ind-and-sg-medical/summary-of-2026-requested-rate-actions .

2. Centers for Medicare & Medicaid Services (CMS). Patient Protection and Affordable Care Act; Marketplace Integrity and Affordability (Final Rule). 18 June 2025, PDF, https://www.cms.gov/files/document/cms-9884-f-2025-pi-rule-master-5cr-062025.pdf .

3. Minemyer, Paige. “Aetna to Exit the ACA Exchanges in 2026.” Fierce Healthcare , 1 May 2025, https://www.fiercehealthcare.com/payers/aetna-exit-aca-exchanges-2026 .
Pages/Sections referenced: Article body noting ~1 million exchange members and the 2026 exit (single web page; n. pag.).

What are the eligibility criteria for participation in the SEPP plan for employees of The University of Chicago, and how can factors like years of service and age impact an employee's benefits under this plan? Discuss how these criteria might have changed for new employees post-2016 and what implications this has for retirement planning.

Eligibility Criteria for SEPP: Employees at The University of Chicago become eligible to participate in the SEPP upon meeting age and service requirements: being at least 21 years old and completing one year of service. For employees hired after the plan freeze on October 31, 2016, these criteria have been crucial in determining eligibility for newer employees, impacting their retirement planning as they do not accrue benefits under SEPP beyond this freeze date.

In what ways does the SEPP (Staff Employees Pension Plan) benefit calculation at The University of Chicago reflect an employee's years of service and final average pay? Examine the formulas involved in the benefits determination process, including how outside factors such as Social Security compensation can affect the total pension benefits an employee receives at retirement.

Benefit Calculation Reflecting Service and Pay: The SEPP benefits are calculated based on the final average pay and years of participation, factoring in Social Security covered compensation. Changes post-2016 have frozen benefits accrual, meaning that current employees’ benefits are calculated only up to this freeze date, affecting long-term benefits despite continued employment.

How can employees at The University of Chicago expect their SEPP benefits to be paid out upon their retirement, especially in terms of the options between lump sum distributions and annuities? Analyze the advantages and disadvantages of each payment option, and how these choices can impact an employee's financial situation in retirement.

Payout Options (Lump Sum vs. Annuities): Upon retirement, employees can opt for a lump sum payment or annuities. Each option presents financial implications; lump sums provide immediate access to funds but annuities offer sustained income. This choice is significant for financial stability in retirement, particularly under the constraints post the 2016 plan changes.

Can you elaborate on the spousal rights associated with the pension benefits under the SEPP plan at The University of Chicago? Discuss how marital status influences annuity payments and the required spousal consent when considering changes to beneficiary designations.

Spousal Rights in SEPP Benefits: Spouses have rights to pension benefits, requiring spousal consent for altering beneficiary arrangements under the SEPP. Changes post-2016 do not impact these rights, but understanding these is vital for making informed decisions about pension benefits and beneficiary designations.

As an employee nearing retirement at The University of Chicago, what considerations should one keep in mind regarding taxes on pension benefits received from the SEPP? Explore the tax implications of different types of distributions and how they align with current IRS regulations for the 2024 tax year.

Tax Considerations for SEPP Benefits: SEPP distributions are taxable income. Employees must consider the tax implications of their chosen payout method—lump sum or annuities—and plan for potential tax liabilities. This understanding is crucial, especially with the plan’s benefit accrual freeze affecting the retirement timeline.

What resources are available for employees of The University of Chicago wishing to understand more about their retirement benefits under SEPP? Discuss the types of information that can be requested from the Benefits Office and highlight the contact methods for obtaining more detailed assistance.

Resources for Understanding SEPP Benefits: The University provides resources for employees to understand their SEPP benefits, including access to the Benefits Office for personalized queries. Utilizing these resources is essential for employees, especially newer ones post-2016, to fully understand their retirement benefits under the current plan structure.

How does The University of Chicago address benefits for employees upon their death, and what provisions exist for both spouses and non-spouse beneficiaries under the SEPP plan? Analyze the specific benefits and payment structures available to beneficiaries and the conditions under which these benefits are distributed.

Posthumous Benefits: The SEPP includes provisions for spouses and non-spouse beneficiaries, detailing the continuation or lump sum payments upon the death of the employee. Understanding these provisions is crucial for estate planning and ensuring financial security for beneficiaries.

What factors ensure an employee remains fully vested in their pension benefits with The University of Chicago, and how does the vesting schedule affect retirement planning strategies? Consider the implications of not fulfilling the vesting criteria and how this might influence decisions around employment tenure and retirement timing.

Vesting and Retirement Planning: Vesting in SEPP requires three years of service, with full benefits contingent on meeting this criterion. For employees navigating post-2016 changes, understanding vesting is crucial for retirement planning, particularly as no additional benefits accrue beyond the freeze date.

Discuss the impact of a Qualified Domestic Relations Order (QDRO) on the SEPP benefits for employees at The University of Chicago. How do divorce or separation proceedings influence pension benefits, and what steps should employees take to ensure compliance with a QDRO?

Impact of QDROs on SEPP Benefits: SEPP complies with Qualified Domestic Relations Orders, which can allocate pension benefits to alternate payees. Understanding how QDROs affect one’s benefits is crucial for financial planning, especially in the context of marital dissolution.

How can employees at The University of Chicago, who have questions about their benefits under the SEPP plan, effectively communicate with the Benefits Office for clarity and assistance? Specify the various communication methods available for employees and what kind of information or support they can expect to receive.

Communicating with the Benefits Office: Employees can reach out to the Benefits Office via email or phone for detailed assistance on their SEPP benefits. Effective communication with this office is vital for employees to clarify their benefits status, particularly in light of the post-2016 changes to the plan.