What the 2027 ACA Premium Increase Costs You Depends on Your Income

A Subsidy Follows the Sticker Price Up

The law caps what you pay for the benchmark plan at a share of your income. The benchmark is the second-cheapest Silver plan in your area. The government pays the rest as a premium tax credit. When the benchmark gets more expensive, the credit grows by the same dollars and your share stays tied to your income.

Take a couple, ages 60 and 62, living in New Jersey, with $60,000 of MAGI. We estimate their benchmark premium at $23,916 for 2026. For 2027 we raised it 15% to match the KFF median, which gives $27,504. That is $3,588 more.

The sticker price rose $3,588 and the couple pays $36 more. The IRS nudged the required share of income up for 2027 and the poverty line moved, and those two changes account for the $36.

This holds for the benchmark plan. If you buy a plan that costs more than the benchmark, you pay the difference. A carrier that raised its rates faster than the others can push your current plan above the benchmark. In New Jersey, UnitedHealthcare asked for more than double Horizon’s increase. Compare plans in November instead of letting last year’s plan renew on its own.

Above 400% of the Poverty Line, You Pay All of It

The tax credit stops completely at 400% of the federal poverty level. The poverty guidelines HHS published in January 2026 set the line for 2027 coverage. That is $63,840 for one person and $86,560 for two. One dollar over and the credit drops to zero.

The same couple shows what that means. At $86,559 of MAGI they pay $8,844 for the year. At $86,561 they pay the full $27,504. The two dollars of income cost them $18,660.

A bigger sticker price makes that drop deeper. The table shows what crossing the line costs in each year, using our New Jersey benchmark estimates. It also shows a 58-year-old single retiree.

Now picture a Roth conversion. Say the couple expects $80,000 of MAGI in 2027 and converts another $10,000. Their MAGI becomes $90,000, which is over the line. Their premium goes from $8,172 to $27,504. The conversion added $19,332 to the couple’s health insurance bill, and that is on top of the income tax on the $10,000.

The same cliff applies to a capital gain, a rental sale or a large IRA withdrawal. The cost of a mistake near the line grew with the premium. We cover the conversion side in more detail in Roth conversion strategy for early retirees.

Who Pays the Full Increase

Three groups pay the whole 15% or 20%. The first is anyone with income over 400% of the poverty line. The second is anyone who picks a plan above the benchmark and pays the gap. The third is anyone who buys without a subsidy, including people who skip the marketplace and buy off-exchange.

Everyone else sees most of the increase absorbed by the tax credit. New Jersey’s acting insurance commissioner said the increases will strain household budgets and may lead some residents to drop coverage. Check your price after the credit before you decide anything. The headline number may not be yours.

How We Got These Numbers

ThunderHarbor starts from a national benchmark premium for a 40-year-old, adjusts it for age and state, and raises it 15% for 2027 to match the KFF median. New Jersey’s filings are higher, so a real 2027 benchmark in your county may sit above the figures here. The benchmark also varies by county, and the final rates may differ from the filings. Marketplace sites show the real prices when open enrollment opens.

The 2026 figures use the January 2025 poverty guidelines, which govern 2026 coverage. Our earlier post used a slightly lower 2026 poverty line, so its 2026 premiums run a few dollars away from the ones here.

The earlier post on the 2027 subsidy and out-of-pocket schedules covers the IRS and CMS tables. This post covers the insurers’ side. To run your own household, use the ACA subsidy calculator.