When families pay more for health coverage, they spend less on everything else, including, as it turns out, the healthcare itself. That finding runs through a new economic analysis by Lauren Benavidez-Brouk of IMPLAN, an economic modeling firm, timed to open enrollment for 2027 ACA marketplace coverage, which begins November 1.
Insurers have proposed a median 15% premium increase for 2027, according to a KFF analysis of rate filings from 276 insurers across all 50 states and the District of Columbia. It is the second consecutive year of double-digit proposed hikes, following a finalized median increase of 20% in 2026. IMPLAN modeled what happens when unsubsidized households absorb that 15% increase, tracing where the money comes from and where it stops going.
The headline number is a projected reduction of approximately $60 million in US GDP and more than 1,500 jobs lost across the economy, as households reallocate spending toward insurance premiums and away from other goods and services. Insurers gain, adding roughly $625 million in output and more than 1,300 jobs. But that gain is outweighed by losses spread across housing, retail, restaurants, and healthcare providers. Those losses accumulate because higher insurance costs leave households with less to spend.
The counterintuitive element is the healthcare sector itself. Hospitals and physicians’ offices are projected to lose about $55 million in business activity and around 240 jobs as families, squeezed by higher premiums, cut back on care. That is roughly the same number of jobs that restaurants are expected to lose. The pattern reflects a dynamic that any advisor working with unsubsidized clients has likely seen: higher premiums do not buy more healthcare, they replace it.
The IMPLAN analysis covers only unsubsidized marketplace households, the segment facing the most acute cost pressure and where a significant share of individual-market clients sit. KFF’s May 2026 enrollment analysis found that sign-ups fell sharply among adults aged 18 to 34, and fell 44% among those with incomes between 400% and 500% of the federal poverty level, the band just above the subsidy cliff where premium tax credit eligibility ends. That income bracket represented roughly 3% of 2025 enrollment but accounted for 27% of the coverage drop. The people who stayed on marketplace plans tended to be older and sicker, which is part of what is driving 2027 proposed rates higher still.
As the proposed 2027 rate increases show, the exit of healthier enrollees pushes remaining premiums up, which pushes out more healthy enrollees, which pushes premiums higher again. The cycle is self-reinforcing, and the IMPLAN analysis puts a dollar figure on what it costs beyond the individual plan holder.
The question for any unsubsidized client reconsidering marketplace coverage is whether small group offers a better option. The answer for 2027 is not straightforwardly yes. Small group insurers are requesting a median 14% premium increase for 2027, according a Peterson-KFF Health System Tracker analysis of filings from nearly 300 insurers.
The small group market has its own risk pool problem: fully insured enrollment has fallen from roughly 17 million people in 2013 to about 10 million in 2024, as healthier groups migrated to level-funded arrangements. That pool contraction is putting upward pressure on fully insured small group pricing in much the same way subsidy expiration has pressured the marketplace.
For clients caught between two markets with double-digit proposed increases, the question shifts from “which plan is cheaper” to “which structure is more stable.” ICHRA adoption jumped 53% in 2026, according to the HRA Council, as more employers moved toward defined-contribution models that cap their cost exposure rather than absorb annual premium volatility.
IMPLAN’s modeled estimates are based on a 15% increase and presented in 2027 dollars, according to IMPLAN’s October 2026 analysis. Final rates are subject to state regulatory review.
