Costs surge again for Michigan health insurance plans

Michigan regulators approved 2027 price increases of 14.2% for individual health insurance plans, including those sold on the ACA marketplace, and 9.6% for small group plans
Individual market enrollment in the state dropped by more than 130,000 in a year
Michigan’s marketplace enrollment drop of 27% was more than double the national decline

Michigan residents are grappling with the affordability of their healthcare plans as the state sees another round of insurance rate hikes. Roughly 130,000 fewer people in the state are receiving coverage through the Affordable Care Act marketplace heading into 2027.

Rates for about 400,000 people who purchase their own health plans are up an average of 14.2% ahead of the Nov. 1 start of open enrollment, state regulators announced Wednesday. Another 400,000 receiving coverage through small group plans — covering small businesses with fewer than 51 employees — are seeing rates rise 9.6% on average.

There are also fewer insurers making plans available on HealthCare.gov as time goes on — seven companies will offer ACA coverage in Michigan next year, the same as this year but down from 15 in 2016.

Employer-sponsored insurance plans are also expected to see big jumps: This year, the average worker contributed $7,471 towards family coverage, according to health research firm KFF, up 9% from 2025. Costs are forecast to land between 8% and 11% higher next year, according to national surveys conducted by the consulting firm Marsh.

Last year’s expiration of enhanced premium subsidies for plans purchased through the ACA marketplace, federal rules changes and new provisions tied to President Trump’s One Big Beautiful Bill Act, some which have yet to take effect, are contributing to the trend, according to the University of Michigan’s Center for Health and Research Transformation, or CHRT.

“Taken together, they move in the same direction: narrowing who is eligible, shortening the enrollment window, adding new paperwork requirements to claim a tax credit, and raising costs for enrollees who remain,” the center said in a policy brief published this month.

The state’s enrollment declines on the federal marketplace are more severe than the national average. Enrollment dropped 12% across the US this year, while Michigan saw a decline of 27%. Neighboring Ohio saw a loss of 32% and Indiana saw a drop of 28%, while states that provided their own subsidies or operated their own healthcare marketplace were less affected.

After surveying local companies, leaders of the Small Business Association of Michigan described employers being crushed by healthcare costs, with many saying the issue tops their priorities for the incoming governor and state Legislature.

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“The affordability crisis is here, and it’s real,” said Bret Jackson, president and CEO of the Economic Alliance of Michigan, which advocates for employers and labor unions on healthcare issues. “Loss of health coverage is accelerating quickly.”

Along with shrinking insurance participation in the federal marketplace, plan choices have also thinned with options limited for some residents based on geography. Consumers will have 143 marketplace plans statewide in 2027, up from 116 this year but down from 231 in 2023.

The biggest single shift came at Meridian Health Plan of Michigan, which exited the Metro Detroit market this year. The insurer reported 156,012 individual market enrollees in its 2026 rate filing and 18,938 in its 2027 filing, a loss larger than the decline across the entire market.

Ambetter from Meridian, the company’s marketplace option, will return to Wayne, Oakland, Macomb and Monroe counties in 2027 and add Bay County, a company spokesperson said in a statement.

Affordability woes

A Bridge Michigan analysis of public comments made to the Michigan Department of Insurance and Financial Services, which is tasked with approving the state’s health insurance rates, found universal opposition to rate hikes.

Seniors, doctors and insurance brokers described their concerns that health insurance rates were outpacing inflation and cost of living expenses. Many described being priced out of affordability.

One person, who reported spending $2,500 a month for coverage for their family, said the increases will “force us to drop [healthcare] coverage completely.” Another said the rate increase would push them to “drop buying healthcare insurance on the marketplace and work less” to qualify for Medicaid.

The rate of Michiganders and Americans going uninsured is also increasing.

About 5.5% of the state’s population goes without healthcare coverage, according to the latest Census data. While the state falls below the national uninsured rate of 8.4%, Michigan’s levels of people going without healthcare coverage are returning to levels not seen since before the onset of the COVID-19 pandemic.

Whether you buy your own plan or get coverage through work, Medicaid or Medicare, Bridge wants to know how you’re thinking about coverage. Your response may help in future coverage for Health Watch. [Take our 2-minute survey →]

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