Los Angeles Fire and Police Pensions Employees Face 2026 Health Insurance Premium Surge: Preparing for Rising Costs

Healthcare Provider Update: Healthcare Provider for Los Angeles Fire and Police Pensions The healthcare provider for Los Angeles Fire and Police Pensions typically encompasses a variety of insurance plans catering to its members, often including major insurers such as Anthem Blue Cross, Kaiser Permanente, and others, depending on the specific program selected by the employees. Potential Healthcare Cost Increases in 2026 In 2026, employees of Los Angeles Fire and Police Pensions may face a substantial increase in healthcare costs due to anticipated record hikes in ACA premiums, with some states projecting increases exceeding 60%. This surge results from a combination of factors including escalating medical expenses and the potential expiration of enhanced federal premium subsidies, which could lead to average out-of-pocket premium increases of over 75% for many enrollees. As employers, including Los Angeles Fire and Police Pensions, navigate these challenges, employees need to proactively manage their healthcare benefits and expenses to minimize the financial impact in the coming year. Click here to learn more

'Los Angeles Fire and Police Pensions employees preparing for retirement should account for rising health care premiums as a core expense, and build flexibility into their plans today to help reduce the strain of unexpected costs tomorrow.' – Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.

'Los Angeles Fire and Police Pensions employees nearing retirement should stress-test their plans for higher 2026 health care costs, review coverage options each year, and—when eligible—fund HSAs to keep cash flow resilient.' – Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

1. Why health insurance premiums are expected to rise significantly in 2026.

2. The unique challenges retirees face before becoming eligible for Medicare.

3. Practical strategies to help manage increasing health care expenses.

The Increase in Health Insurance Premiums in 2026: Consequences and Solutions

With over 300 Affordable Care Act (ACA) marketplace providers proposing premium rises of about 18% on average, ¹  health insurance costs are set to climb sharply in 2026. For those exiting the workforce before age 65, including Los Angeles Fire and Police Pensions employees, this change creates a fiscal gap that calls for thoughtful preparation.

'Health care costs are often the single biggest surprise in retirement,' says Brent Wolf, CFP of Wealth Enhancement. Even the most carefully built retirement plan may be disrupted when premiums go up faster than expected. This highlights the need for Los Angeles Fire and Police Pensions retirees to factor in health care expenses when creating retirement scenarios.

Why the Years Before Medicare Are Particularly Difficult

At age 65, most people become eligible for Medicare. People who leave work earlier must find coverage to bridge the gap. Options include:

• - Purchasing ACA marketplace policies

• - Continuing with COBRA payments after leaving employment

• - Using a spouse’s employer-sponsored plan

• - In rare cases, accessing a former employer’s retiree plan

For those who have spent years with Los Angeles Fire and Police Pensions, cost becomes the main issue. Premiums tend to rise sharply in the late 50s and early 60s, with ACA rates often based on age. A couple in their early 60s might pay several thousand dollars per month, before deductibles or prescriptions. ²  Rising premiums can put real strain on those planning to retire before Medicare begins.

Important Factors Affecting the 2026 Increases

Several policy and systemic drivers are fueling the expected ~18% jump:

• Ending subsidies: After 2025, the enhanced ACA tax credits that cap premiums at 8.5% of income are due to expire. ²

• Medical inflation: The cost of hospital stays, outpatient care, and doctor visits continue rising faster than general inflation. ³

• Labor shortages: Health care providers are raising pay and benefits to retain staff, increasing the cost of care.

• Drug costs: High-demand prescription drugs increase insurer costs.

• Tariffs and supply costs: Anticipated import taxes on medical supplies may add pressure.

• Reduced risk pool: If subsidies end, healthier people may drop out of the market, leaving higher-cost individuals behind.

As Wolf remarks, “Healthier participants leave the system when subsidies disappear.” For Los Angeles Fire and Police Pensions workers nearing retirement, this cycle may mean even steeper rates in the years before Medicare.

The Effect in the Real World

Premium hikes will affect families quickly. By 2026, some who stretched budgets for coverage in 2025 may find it unaffordable altogether. Others may need to draw more from retirement savings, weakening long-run sustainability.

“I’ve seen families who were comfortable in retirement suddenly needing to take on part-time work just to cover insurance,” Wolf explains. For Los Angeles Fire and Police Pensions retirees, that reality could require adjusting their retirement lifestyle or rethinking sources of income.

Unexpected medical bills may also force individuals with fixed incomes to cut back on other retirement goals.

Practical Techniques to Control Rising Medical Expenses

While large market forces are beyond individual control, Los Angeles Fire and Police Pensions employees approaching retirement can take steps to ease the burden:

• Review coverage annually: Subsidies and plan options change each year. Automatic renewals may lead to paying too much.

• Consider HDHPs: High-deductible health plans tend to have lower premiums and make participants eligible for health savings accounts (HSAs).

• Leverage HSAs: Contributions grow tax-free and can be used to pay medical costs later.

• Stay in-network: Using approved providers helps reduce out-of-pocket costs.

• Prioritize preventive care: Routine screenings and healthy habits may reduce the chance of large medical bills in future.

The Need to Plan in Advance

Health care costs must now be assumed higher than in many past retirement plans. With subsidies expiring and inflation pressure rising, Los Angeles Fire and Police Pensions retirees should expect bigger expenses.

“My advice is to assume higher health care costs in every scenario,” suggests Wolf. If subsidies continue, that will help, but conservative planning can help avoid surprises.

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Health care planning has become a central pillar of retirement preparation. The 2026 premium jump highlights the importance of adaptability, careful cost estimation, and taking action early.

According to recent data, a record 24.2 million consumers selected or were auto-re-enrolled in ACA marketplace plans in 2025, ⁴  with fewer older registrants than in prior years. This shift means Los Angeles Fire and Police Pensions employees who are not yet Medicare-eligible could grapple with harder budget choices as premiums climb.

In 2026, higher insurance costs will feel like unmarked tolls on the path to Medicare at 65. The road still exists, but detours—expiring subsidies, inflation, costly new drugs—may drain retirement funds faster than many expect. By using tools like health savings accounts and reviewing plan options each year, retirees can get a better handle on their medical expenses to avoid depleting their resources.

Sources:

1. KFF. “ How Much and Why ACA Marketplace Premiums Are Going Up in 2026 ,” by J. Ortaliza et al, 6 Aug. 2025 .

2. KFF. ' ACA Marketplace Premium Payments Would More Than Double on Average Next Year if Enhanced Premium Tax Credits Explire ,' by Justin Lo et al, September 30, 2025. 

3. American Hospital Association, ' The Cost of Caring: Challenges Facing America’s Hospitals in 2025 ,' Apr. 2025.

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