Health Insurance Costs Are Changing in 2026: Here’s What You Need to Know About the Premium Tax Credit
If you buy your health insurance through the Marketplace (and you get Form 1095-A at tax time), the new tax law is about to hit you where it hurts, your wallet. Starting in 2026, many families will see higher health insurance premiums, and the change comes down to one thing: the Premium Tax Credit (PTC).
What Is the Premium Tax Credit?
The Premium Tax Credit was created under the Affordable Care Act (ACA, also known as Obamacare) back in 2010 to help people making between 100% and 400% of the federal poverty level afford coverage.
The idea was simple:
If your income came in lower than expected → you got some of the credit back at tax time.
If your income was higher than expected → you had to repay part of the credit.
It wasn’t perfect, but it gave Marketplace users a safety net.
What Changes in 2026
Under the One Big Beautiful Bill (OB3), that safety net disappears. Starting in 2026, if you receive more Premium Tax Credit than you’re entitled to, you’ll have to repay all of it. No more caps, no more partial forgiveness.
That means it’s now “all or nothing.”
Here’s what the 2026 federal poverty levels look like:
1 person: $15,650
2 people: $21,150
3 people: $26,650
4 people: $32,150
So, if you’re a family of four making $128,600 or more (400% of poverty level), your PTC is gone. For some households, that income feels comfortable. For others, depending on where you live, it barely covers the basics.
Why This Matters (Even If You’re Not on the Marketplace)
You might be thinking: “Well, I don’t use the Marketplace, so this doesn’t affect me.” Wrong.
Here’s the ripple effect:
Fewer people can afford Marketplace coverage.
Those people drop insurance.
Fewer paying customers = higher premiums and deductibles for everyone else.
It’s basic economics. When there’s less buying power in the system, prices go up. (source)
What You Can Do to Prepare
Check your options. If you can get it through your spouse at 9.96% of your wages or less this is a better option.
Business owners: Consider offering group coverage, it may save you (and your employees) money in the long run.
Work with an insurance professional. I know plenty of licensed agents who can help you run the numbers. (I don’t get a dime for referrals, I just want you to have good advice.)
The Bottom Line
The end of the Premium Tax Credit repayment cap in 2026 means higher costs and fewer safety nets for Marketplace users. Even if you don’t buy coverage through the Marketplace, the changes will ripple into premiums across the board.
Don’t wait until you’re surprised with a giant bill at tax time. Review your health insurance options now, especially if your family income is near or above the 400% poverty level cutoff.
👉 Need help navigating how the new tax law impacts health insurance and your tax situation? Contact Ratliff Accounting & Tax LLC today, we’ll help you plan ahead so you’re not caught off guard.
