There’s a theory in quantum mechanics that whenever an event occurs that can have multiple outcomes — like the roll of a die — the universe splits into different realities, one for each outcome. This is called the “Many-Worlds Interpretation.” It’s the idea that there are multiple versions of our universe, our planet, and ourselves. In other words, anything that canhappen,willhappen…just in a different reality than our own.
But there’s one thing, I’m quite certain, that has never happened, and will never happen, inanyuniverse: Consumers being glad when the price of something goes up.
This is my preamble to some news that nobody wants to hear: Health insurance costs are going up next year, and likely by even more than usual. As I’m sending this letter to all my clients, some of whom are older and some of whom are not, I will cover both Medicare as well as private insurance plans. Let’s start with the “what” and then we’ll move onto the “why.”
Medicare Premiums.The costs associated with Medicare Parts B often go up each year, but the jump in 2026 is projected to be bigger than normal.The government projects the standard monthly premium for Part B to be $206.50 in 2026.That’s an 11.6% increase from this year.1
It’s important to note that this is just thestandardpremium. High-income beneficiaries must also pay a surcharge on top of this price. As of this writing, the 2026 income threshold for that surcharge has not yet been finalized. (In 2025, the threshold was $106,000 for individuals and $212,000 for couples filing a joint tax return.1Those numbers will likely go up slightly in 2026 to stay consistent with inflation, but we’ll have to wait until late October to know by how much.)
The government does project the 2026 surcharge to be $82.60, but that number rises depending on the beneficiary’s income.1(For example, the government projects a maximum surcharge of $495.60 for the highest earners.1Typically, that means individuals who earn more than $500,000 per year, or couples filing jointly who earn more than $750,000.)
Premiums for Part D, which offers optional coverage for prescription drugs are also projected to go up to $38.99 per month in 2026. That’s an increase of 6% compared to this year.1The high-income surcharge for Part D is projected to range from $14.50 per month to $91.00.1
Private Plan Premiums.Those younger than 65 who have private health insurance will also likely see their premiums go up next year. This is particularly true if you purchase coverage directly, but those with employer-provided coverage may also be affected.
As every state, employer, provider, and plan is different, it’s impossible to give an exact number of how much your premiums will rise, if at all. But it is possible to study nationwide trends. For example, according to a report by KFF and the Peterson Center on Healthcare, plans available through the Affordable Care Act marketplace will go up by an average of 18% in 2026.Certain people with lower incomes, meanwhile, may see their costs go up by 75% or more!2
Now, it’s easy to read this and think, “Well, I didn’t purchase my insurance through the ACA marketplace.” Or “I’m covered through my employer, so these numbers aren’t relevant to me.” Unfortunately, that’s not the case. You see, when insurance prices go up for anyone,more people tend to drop their coverage. This is especially true for healthy people, who may believe that, since they are healthy, they can go without insurance. But fewer people paying into the pool means that those who stay will end up being charged more to make up the difference. It also means that a larger share of those who remain will be people who are more likely to file claims. More claims, of course, means more payouts to cover procedures, prescriptions, and hospital stays. And that, in turn, means higher premiums for everybody,regardless of how they get their insurance. Alternatively, some with employer-sponsored coverage may not experience higher premiums, but reduced services or higher deductibles instead.
Why premiums are going up in 2026.So, why are premiums rising so dramatically next year? For Medicare, most experts consider it to be due to multiple factors. As baby boomers get older, they tend to visit the doctor more and stay in the hospital longer. In addition, a variety of new drugs and other treatments for various conditions have hit the markets in recent years. Many of those are quite pricy, which adds an even higher burden to Part D premiums. Finally, while the cost of services tends to rise each year, payroll taxes, which are responsible for a large chunk of Medicare’s funding, have not. As a result, beneficiaries must shoulder a larger share of the financial burden.
The situation with private premiums is a little more complex. There are a variety of factors here, too, of course. As with Medicare, the cost of health care services goes up every year. Some insurance companies cite tariffs as a factor. But the number one reason is due to the expiration ofenhanced premium tax credits. These credits, designed to help lower income people afford coverage, were first put in place by the Affordable Care Act. They were then expanded by legislation passed during the pandemic. But those credits expire at the end of 2025, meaning that millions of Americans who relied on them to afford coverage will suddenly have to find a new way to pay.2 (Or, as previously mentioned, drop coverage altogether.)
Now, Congress could still act to renew the credits or implement some new measure to keep premiums from spiking. In the meantime, however, it would be prudent to assume prices willgo up in 2026, and to prepare accordingly. You see, whether there are many universes or not, the advantage we have in thisone is the ability to plan ahead, review all our options, and ensure we take the right path to your financial goals. So, if you are at all concerned about rising premiums in 2026, please let me know. I’d be happy to sit down with you to discuss how this situation may affect you, and what we can do to mitigate the impact.
1“2025 Annual Report of the Boards of Trustees,”Centers for Medicare & Medicaid Services,https://www.cms.gov/oact/tr/2025
2 “How much and why ACA Marketplace premiums are going up in 2026,”Peterson-KFF Health Systems Tracker,https://www.healthsystemtracker.org/brief/how-much-and-why-aca-marketplace-premiums-are-going-up-in-2026
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