With the open enrollment period for health insurance beginning on November 1, 2025, many Californians are facing alarming increases in their premiums. For Tara and Todd Nicklous, their monthly payment for coverage through the Affordable Care Act (ACA) will jump from $923 to an astonishing $3,264 next year. Tara Nicklous, 56, expressed her shock, stating, “My gut sunk.” The couple, who operate a real estate appraisal business, are now faced with a financial burden as they rely on the ACA for necessary medical coverage.
The dramatic increase in premiums stems from the impending expiration of federal tax credits, which were expanded under former President Joe Biden during the COVID-19 pandemic. These credits have significantly lowered insurance costs for millions of Americans but are now at the center of a political standoff in Washington. Democrats are advocating for an extension of these credits, while Republicans refuse to negotiate until the federal government reopens.
Impacts on California Residents
The situation is dire for many of the approximately 2 million Californians enrolled in Covered California, the state’s health insurance marketplace. According to Covered California, the average premiums for enrollees are projected to double by the end of 2025. Numerous residents will see their premiums triple, particularly middle-income families who have benefitted from the expanded ACA tax credits.
Larry Levitt, a health policy executive at KFF, noted that when enrollees in the Bay Area learn about the new pricing, “their eyes are going to pop out of their heads.” Individuals in their 50s and 60s, who have not yet qualified for Medicare, are among those who will be hit hardest by these increases.
Tara Nicklous shared her experience, revealing that her hospital recently billed Kaiser Permanente over $5 million for her T-cell therapy treatment. With medical needs at stake, the couple finds themselves in a position where they must find a way to pay their new premium.
Projected Loss of Coverage
The financial strain may lead to significant loss of coverage across the state. A report by the Urban Institute estimates that around 400,000 Californians could lose their eligibility for Covered California due to the policy changes, with about 175,000 potentially becoming uninsured entirely.
In light of the anticipated expiration of federal tax credits, California officials are preparing to offer limited assistance. The state plans to allocate approximately $200 million in state tax credits for low-income residents who earn slightly above the threshold for Medi-Cal, California’s Medicaid program. For a single individual, this threshold is approximately $25,800 per year.
Rep. Eric Swalwell, an East Bay Democrat representing Castro Valley, criticized Republican lawmakers for contributing to the rising costs. He stated, “For weeks, Democrats have been warning that leaving health care out of this funding bill would raise costs for millions of Americans. Now, those consequences are becoming reality.”
As health insurers prepare for 2026, they are also projecting a 10% average increase in premiums, driven by rising healthcare costs and an uptick in demand for expensive treatments, including weight-loss medications like Ozempic. Kaiser Permanente, California’s largest private insurer, announced a 7.1% increase in rates for its Covered California plans, while Anthem Blue Cross will raise rates by 14.5%.
John Murphy, chief medical officer at La Clínica de La Raza, expressed concern about the impact of rising costs on patient health. He noted that patients often delay preventative care when it becomes too expensive, which can lead to more severe health crises that require emergency treatment.
The Nicklouses are already making difficult adjustments to their lifestyle in anticipation of these changes. Tara remarked, “We’re changing our shopping and our eating habits. I’ve never been such a Walmart and Costco shopper. Vacations? Forget it. Maybe camping.”
As the open enrollment period approaches, many Californians will be grappling with the harsh reality of increased health insurance costs, forcing families to reassess their financial priorities and health care options.
