Californians already struggling to meet their health needs will be even harder hit next year when an increase in health insurance rates goes into effect. But not everything is as bad as it seems at first glance.

Covered California, the state's health insurance marketplace, announced this month that prices for its private health plans will increase an average of 9.9% in 2027, for the second year in a row. This year, prices rose 10.3%.

At the same time, the organization announced that it will add more insurance companies next year, giving people looking for a policy more options that fit their budget.

According to Covered California, the proposed change in rates is attributed to several factors, including rising health care and drug costs, along with broader challenges facing the industry such as actions by the federal government that have increased prices for consumers.

Federal lawmakers' failure last year to extend enhanced tax credits that helped millions of Americans make their monthly payments has also affected the cost of health insurance.

This year, the Trump administration reduced eligibility for lawfully present immigrants, added administrative burdens on families applying for financial aid and further complicated the process for self-employed workers who must recalculate their income annually.

“The federal government has made it difficult for the American worker to access quality health coverage at a price they can afford,” Jessica Altman, executive director of Covered California, said in a statement. “The impact of these federal actions continues to reduce affordability and put health coverage out of reach for many — something that, fortunately, the state is countering.”

Despite the preliminary weighted average rate increase of 9.9%, most Covered California enrollees will be protected from higher monthly payments. Thanks to existing federal tax credits and the expansion of California's subsidy program, 60% of enrollees will not see an increase in their monthly payment, 26% will remain eligible for $0 monthly payments without changing plans, and many more could pay less each month.

By 2027, twelve insurers will offer plans statewide, ensuring all Californians have access to two or more options. Additionally, 92% will be able to choose between three or more insurers and close to 75% will have four or more companies to choose from.

“This shows the value of having a Covered California plan, that even when prices go up, people choose to keep or change their health insurance plans rather than lose their coverage,” Altman said. "It's clear that once people have access to an insurance plan, they want to keep it. So it's critical to keep up the fight and look for ways to provide that affordable access to all Californians."

For more information visit: www.coveredca.com/espanol/.

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