14.2% Rate Hike Approved for Michigan's Individual Health Plans

Michigan regulators approved an average 14.2% rate increase for individual health insurance plans effective Nov. 1, the first day of open enrollment. The decision impacts roughly 400,000 residents who purchase their own coverage, including those using the Affordable Care Act marketplace. Small group plans, covering businesses with fewer than 51 employees, saw an average 9.6% hike affecting another 400,000 people.

The price surge arrives as enrollment in the state's marketplace collapses. Approximately 130,000 fewer Michiganders are covered through ACA plans heading into 2027. This represents a 27% decline, more than double the 12% drop seen across the United States. Neighboring states faced similar pressures, with Ohio losing 32% of its enrollment and Indiana dropping 28%.

Market options have also thinned considerably. Seven insurers will offer ACA coverage in Michigan next year, unchanged from this year but down from 15 companies in 2016. Consumers will have access to 143 statewide marketplace plans in 2027, up from 116 this year but down from 231 in 2023. Meridian Health Plan of Michigan made the largest single move, exiting the Metro Detroit individual market after dropping from 156,012 enrollees in 2026 to 18,938 in its 2027 filing.

Employers are feeling the squeeze as well. The average worker contributed $7,471 toward family coverage this year, a 9% increase from 2025. Marsh, a consulting firm, forecasts employer costs to rise between 8% and 11% next year. Bret Jackson, president and CEO of the Economic Alliance of Michigan, called the situation an affordability crisis that is real and accelerating.

The University of Michigan’s Center for Health and Research Transformation attributes the trend to the expiration of enhanced premium subsidies and new provisions in the One Big Beautiful Bill Act. The center noted that these changes narrow eligibility, shorten enrollment windows, and add paperwork requirements for tax credits. Ambetter from Meridian will return to Wayne, Oakland, Macomb, and Monroe counties next year and add Bay County, according to a company spokesperson.

Public comments to the Michigan Department of Insurance and Financial Services showed universal opposition to the hikes. Residents described being priced out, with one person spending $2,500 monthly for family coverage saying the increases will force a drop in coverage. About 5.5% of Michigan’s population is currently uninsured, a rate returning to pre-pandemic levels despite remaining below the national average of 8.4%.

The state’s small business leaders described employers as being crushed by healthcare costs. Many identified the issue as their top priority for the incoming governor and state Legislature. The rate approval stands as a concrete step forward for 2027, locking in higher premiums for a shrinking pool of insured residents.