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

U.S. Bancorp Retirees Face ACA Premium Shock—Here’s How Others Are Responding

Healthcare Provider Update: Healthcare Provider for U.S. Bancorp U.S. Bancorp, the parent company of U.S. Bank, primarily partners with UnitedHealthcare for its corporate health insurance offerings. This relationship allows U.S. Bancorp to provide a range of health benefits to its employees through UnitedHealthcare's extensive network and services. Potential Healthcare Cost Increases in 2026 In 2026, U.S. Bancorp may face substantial healthcare cost increases, influenced predominantly by rising insurance premiums driven by multiple factors. Record hikes in premiums are anticipated as federal subsidies from the Affordable Care Act expire, which could result in over 22 million enrollees experiencing steep out-of-pocket expenses. With major insurers like UnitedHealthcare requesting rate increases upward of 66% in certain markets, U.S. Bancorp's healthcare costs could rise significantly, compelling both the company and its employees to navigate a more expensive healthcare landscape. This situation highlights the urgent need for strategic planning to mitigate the financial impact on employees and the company's overall benefits strategy. Click here to learn more

'U.S. Bancorp employees approaching retirement should recognize that proactive income and health care planning can make the difference between preserving subsidy eligibility and facing sharply higher ACA premiums.' – Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.

'U.S. Bancorp employees planning their retirement should consider how income levels influence ACA subsidies, as even small adjustments in taxable withdrawals can affect future health care affordability.' – Tyson Mavar, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How the expiration of enhanced ACA subsidies after 2025 could impact health care costs for retirees and early retirees.
Real-life case studies illustrating how different individuals are adjusting to rising ACA premiums.
Practical steps U.S. Bancorp professionals can take before enrolling in 2026 Marketplace plans.

by Brent Wolf, CFP®, Wealth Enhancement

As open enrollment for 2026 Marketplace plans begins, many households are seeing dramatic shifts in their renewal letters. Rising base premiums and the possible end of enhanced subsidies after 2025 could mean significantly higher out-of-pocket costs for anyone purchasing coverage through the Affordable Care Act (ACA) exchange.

The Kaiser Family Foundation (KFF) estimates that if Congress does not extend enhanced premium tax credits, average net premium payments could more than double in 2026. ¹

“It feels like a second mortgage to pay this premium.”

Profile: A couple in their early 60s who retired a few years before becoming Medicare-eligible.

What changed: Their ACA premium had been manageable due to increased subsidies. Their renewal now indicates a rise of about $1,000 to $1,200 monthly if enhanced credits expire.

Decision pressure: They faced hard choices—drawing more taxable income from IRAs, going without coverage, or returning to the workforce for employer-based insurance.

Our response: We reworked their income plan to align with the ACA’s income-based subsidy structure. By controlling their Modified Adjusted Gross Income (MAGI) through smaller IRA withdrawals, use of cash reserves, and partial Roth conversions, we kept them eligible for key subsidies. Comparing a Bronze high-deductible plan with a health savings account (HSA) to a Silver plan revealed the Silver plan—thanks to cost-sharing reductions—was more economical given their expected medical treatments.

“I can’t risk losing coverage while battling an illness.”

Profile: A single client in her early 60s undergoing ongoing medical treatment.

What changed: Without enhanced subsidies, her premiums nearly tripled.

Decision pressure: Balancing affordability with the need to keep her care team and prescriptions consistent.

Our response: We prioritized staying with her provider network and controlling her out-of-pocket costs. A dedicated “medical reserve” fund—equal to one year’s maximum out-of-pocket limit—gave her a cushion without liquidating investments during market declines. We also worked with her physicians to identify lower-cost prescriptions through her plan’s formulary.

“The new premiums are hurting our business margins.”

Profile: A self-employed couple—one partner managing asthma and the other a cardiac rhythm condition.

What changed: Without subsidies, their net premiums are expected to rise sharply.

Decision pressure: Continue paying high premiums, choose a plan with a very high deductible, or seek W-2 employment for benefits.

Our response: We compared total annual costs for a Silver plan versus a Bronze option, factoring in frequent specialist visits and prescriptions. Once total medical costs were considered, the Silver plan proved more cost-effective. We also aligned their life and disability coverage and tailored their tax approach to reflect potential changes in premium tax credits.

“I’m young and healthy—do I even need full coverage?”

Profile: An independent contractor in their 20s with minimal expected medical use.

What changed: Premiums for mid- and high-tier plans nearly quadrupled.

Decision pressure: Choosing between a high-deductible Bronze HSA plan and catastrophic coverage.

Our response: We modeled three options—a Bronze HSA-eligible plan, a mid-tier plan, and catastrophic coverage. The Bronze HSA option offered the best mix of lower premiums and long-term tax benefits. Monthly automated HSA contributions build a future medical fund that can later be used for qualified health care expenses or Medicare premiums (excluding Medigap) after age 65.

Five Steps to Take Before You Enroll

1. Evaluate your total annual cost, not just the premium. Factor in deductibles, copays, and the possibility of reaching your out-of-pocket maximum.

2. Manage your MAGI carefully. ACA subsidies depend on income. Coordinate Roth conversions, capital gains, and IRA withdrawals strategically.

3. Verify your doctor and prescription coverage. Always confirm your plan’s provider network and formulary before enrolling.

4. Maintain a medical reserve fund. Hold six to 12 months of premiums plus a portion of your maximum out-of-pocket in cash or short-term Treasuries.

5. Finalize your plan by December 15. Open Enrollment for 2026 coverage ends on December 15, with plans effective January 1.

If Affordability Is a Concern

Choosing to go without insurance can expose you to serious financial strain in case of illness or accident. Consider the most affordable Bronze plan that still meets ACA minimum coverage requirements. If your income decreases during the year, you may become eligible for Medicaid or CHIP and qualify for a Special Enrollment Period. ²

How The Retirement Group Supports U.S. Bancorp Professionals

For U.S. Bancorp employees approaching or already in retirement, the intersection of rising health care costs and income planning can be complex. The Retirement Group focuses on helping clients navigate ACA subsidy rules, tax-efficient withdrawal strategies, and health care cost planning during retirement transitions.

To speak with an advisor about aligning your retirement income and health care planning, call (800) 900-5867 today.

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Sources:

1. Cox, Cynthia, et al. “ACA Marketplace Premium Payments Would More Than Double on Average Next Year if Enhanced Premium Tax Credits Expire.” Kaiser Family Foundation (KFF) , 2025, pp. n.p., https://www.kff.org/affordable-care-act/aca-marketplace-premium-payments-would-more-than-double-on-average-next-year-if-enhanced-premium-tax-credits-expire/ .
2. Centers for Medicare & Medicaid Services. ' Understanding Special Enrollment Periods. ' June 2025.
Other resources:
1. “When Can You Get Health Insurance? | Dates & Deadlines.” HealthCare.gov , U.S. Centers for Medicare & Medicaid Services, n.d., https://www.healthcare.gov/quick-guide/dates-and-deadlines/ .
2. Publication 969: Health Savings Accounts and Other Tax-Favoured Health Plans. Internal Revenue Service, 2024, pp. 8–9, https://www.irs.gov/pub/irs-pdf/p969.pdf .
3. “Silver vs. Bronze Plan Selection: Cost-Comparison Scenarios.” Centers for Medicare & Medicaid Services (CMS) , 23 Dec. 2024, pp. 1–3, https://www.cms.gov/files/document/silver-vs-bronze-cost-comparison-scenario-resource.pdf .
4. Murphy, Tom. “Expect Health Insurance Prices to Rise Next Year, Brokers Say.” AP News , Associated Press, 24 Aug. 2025, https://apnews.com/article/health-insurance-drug-costs-2026-rates-c4d865ec09c7088ecc6b55dc520f3566 .

How does the U.S. Bank Legacy Pension Plan calculate the Final Average Total Pay and Final Average Base Pay for employees, and what implications might these calculations have for retirement planning? What factors should employees at U.S. Bank consider when planning for their eventual retirement based on their pay history?

The U.S. Bank Legacy Pension Plan calculates Final Average Total Pay by taking the average of an employee's Total Pension Pay for the five consecutive calendar years during the last ten years of employment that provide the highest average. Similarly, Final Average Base Pay is calculated by averaging the Base Pension Pay for the same five-year period. Total Pension Pay includes base pay plus commissions, bonuses, and overtime, while Base Pension Pay only includes base salary and a few other components such as shift differentials and premium pay. These calculations significantly affect retirement planning, as higher pay during the last years of employment can lead to a more substantial pension benefit(US Bancorp_January 2023…).

What steps does U.S. Bank require for employees who wish to commence their pension benefits, and how does the timing of this commencement affect the benefits they will ultimately receive? Employees at U.S. Bank should understand the critical timelines associated with the retirement process, including the importance of initiating their requests within specific timeframes.

Employees who wish to commence their pension benefits must initiate the process at least 30 to 90 days before their intended benefit commencement date. The timing affects the benefits, as early retirement (before age 65) results in reduced monthly benefits due to the extended period over which benefits are paid. Conversely, delaying the commencement of benefits until the full retirement age (65) or later ensures the maximum monthly pension benefit(US Bancorp_January 2023…).

What are the different forms of payment options available under the U.S. Bank Legacy Pension Plan, and how might these options change based on the employeeâ€™s age and years of service? U.S. Bank employees need clarity on how to choose the best payment option to meet their individual needs in retirement.

The Plan offers several payment options, including a single life annuity, joint and survivor annuities (50%, 75%, or 100%), and estate protection annuities. These options can vary based on the employee's age and years of service. For example, younger employees may have a reduced monthly benefit if they choose early retirement, while older employees nearing or beyond age 65 will receive full benefits without reduction. The employee's choice of annuity type also affects the monthly payout and survivor benefits(US Bancorp_January 2023…).

How does U.S. Bank ensure the security of employees' pension plan information and personal benefits data, and what measures should employees take to protect their information? Employees should be informed about the companyâ€™s security protocols and best practices for safeguarding sensitive information related to their pension.

U.S. Bank implements several security measures, including encouraging employees to use strong, unique passwords for accessing benefit information and enabling multifactor authentication. Employees should also regularly monitor their account for unauthorized transactions, update contact information to receive notices, and use secure networks when accessing their pension plan data(US Bancorp_January 2023…).

In the event that an employee at U.S. Bank undergoes reemployment after retirement, how does this impact their pension benefits and what should they be aware of regarding benefit accrual? Employees need guidance on how transitioning back to work could affect their pension plans and retirement strategies.

If a retired U.S. Bank employee is rehired, their pension payments continue as usual. However, they will not accrue any additional benefits under the Legacy Pension Plan but may be eligible for participation in the Legacy 2010 Cash Balance Portion of the Plan. It is essential for rehired employees to understand the implications on their pension accrual and benefits(US Bancorp_January 2023…).

What are the eligibility requirements for participation in the U.S. Bank Legacy Pension Plan, and how do changes in employment status affect an employee's pension benefits? U.S. Bank staff should have a comprehensive understanding of eligibility criteria and how various employment changes can impact their pension rights.

Eligibility is limited to employees who had earned a benefit before January 1, 2020, or those rehired in an eligible position. Employment status changes, such as termination or reemployment, can affect whether an employee remains in the Plan. For example, employees rehired after January 1, 2020, may not accrue additional benefits under the Legacy Pension Plan(US Bancorp_January 2023…).

What specific rights do U.S. Bank employees have under the Employee Retirement Income Security Act (ERISA) in relation to their pension plan benefits, and how can they enforce these rights? U.S. Bank employees must be made aware of their legal rights to access plan information and contest any disputes regarding their benefits.

Employees have rights under ERISA to access plan information, file claims, and appeal denied claims. U.S. Bank employees can enforce these rights by submitting claims or appealing denials through the Plan's claims and appeals procedures. Additionally, employees may bring legal action if they exhaust the Plan's internal processes(US Bancorp_January 2023…).

How does U.S. Bancorp ensure that its pension plan complies with current IRS limits, and what should employees know about potential tax implications on their pension benefits? Clear communication from U.S. Bank regarding tax consequences and IRS guidelines for retirement benefits is crucial for employees to manage their finances effectively post-retirement.

The Plan adheres to IRS regulations, including limits on annual earnings ($330,000 in 2023) that can be considered for pension benefit calculations. Employees should understand the potential tax implications on their pension distributions and are encouraged to consult tax advisors to ensure proper tax handling(US Bancorp_January 2023…).

What processes are in place for U.S. Bank employees to file claims or appeals if they believe they are entitled to additional benefits under the pension plan? Employees at U.S. Bank should be informed about the claims process and know their options for seeking justice if their claims are disputed.

Employees can file claims or appeals by contacting U.S. Bank Employee Services or accessing the Plan’s claims procedures. Deadlines apply, and employees must submit claims within the specified time limits to avoid losing their rights to additional benefits(US Bancorp_January 2023…).

How can U.S. Bank employees contact the company for further assistance regarding the U.S. Bank Legacy Pension Plan, and what resources are available to them through the Employee Services division? Itâ€™s essential that U.S. Bank staff knows how to reach out for support regarding their retirement benefits and understands the services provided to help them navigate their pension plans.

Employees can contact U.S. Bank Employee Services by calling 800-806-7009 and selecting "Savings and retirement." Additionally, the Your Total Rewards website provides 24/7 access to pension information and support. Employees are encouraged to use these resources for assistance with their pension plan(US Bancorp_January 2023…).