More Minnesotans Turn to MNsure as Federal Savings Expire, Premiums Rise

St. Paul, MN

When Congress allowed enhanced federal premium tax credits to expire at the end of 2025, the shift did not arrive in Minnesota as a headline first. It arrived as a bill.

For thousands of Minnesotans who buy coverage through MNsure, the state’s health insurance marketplace, January renewal notices reflected what policy experts had warned for months: the era of expanded federal savings was over. Monthly premiums climbed. Subsidies shrank or disappeared. And families who had carefully budgeted under one set of rules were forced to reconsider their options under another.

The result was an enrollment season defined not by apathy, but by urgency.

MNsure reports that 139,251 Minnesotans enrolled in private health plans for 2026, down from 151,512 the year prior, an 8 percent decline. At the same time, the agency fielded more than 165,000 calls, a 29 percent increase, and recorded record web traffic as consumers searched for financial help and eligibility guidance. The number of enrollees who switched plans surged 87 percent, with most migrating toward lower-cost coverage options.

MNsure CEO Libby Caulum said many callers described the same experience: they felt “priced out” after federal savings lapsed.

The Federal Backdrop: The End of the Subsidy Cliff Fix

The premium spike was not accidental. It was structural.

The enhanced premium tax credits first enacted under the American Rescue Plan Act of 2021 and later extended by the Inflation Reduction Act of 2022 did two consequential things:

• Eliminated the “subsidy cliff.” No enrollee purchasing a benchmark silver plan had to pay more than 8.5 percent of household income, even if earnings exceeded 400 percent of the federal poverty level.
• Expanded savings for lower-income households. Many Minnesotans near the poverty line qualified for $0 premium plans.

When those enhancements expired at the close of 2025, the math changed immediately. Households earning above 400 percent of the federal poverty level once again faced the full, unsubsidized cost of coverage. Lower-income enrollees, while still eligible for tax credits, saw their out-of-pocket contributions increase.

Governor Tim Walz’s office warned in advance that without congressional action:

• Nearly 90,000 Minnesotans would pay more for coverage
• Roughly 19,000 could lose premium assistance entirely
• Average household premiums could rise by hundreds of dollars per month

MNsure separately estimated that affected enrollees would see increases averaging roughly $177 per month, with some households facing far steeper jumps.

The “Great Shift”: Consumers Fought to Stay Covered

The enrollment dip does not tell the whole story. Beneath the 8 percent decline lies what might be called a “great shift” in consumer behavior.

The 87 percent jump in plan-switching signals a marketplace in motion. Consumers who could not absorb higher premiums did not necessarily leave immediately. Many downgraded.

Industry data nationwide show that when premiums rise, shoppers often move from gold or silver plans with lower deductibles into bronze plans or high-deductible health plans in order to preserve monthly affordability. That pattern appears consistent with Minnesota’s numbers.

In short, Minnesotans did not stop shopping. They shopped harder.

Operational Strain and the Rise in Assistance Demand

The surge in calls and online traffic underscores a second reality: as federal assistance decreased, the system became more complex for consumers.

MNsure relies on a statewide network of certified navigators and brokers who help individuals compare plans, verify eligibility, and determine whether they qualify instead for Medical Assistance or MinnesotaCare, the state’s Basic Health Program for lower-income residents.

With enhanced credits gone, more households needed help recalculating eligibility thresholds, assessing new deductibles, and understanding trade-offs between premiums and out-of-pocket exposure.

The paradox of 2026 is clear. Fewer people enrolled in private plans, but more people needed help navigating the marketplace.

Who Is Getting Squeezed?

The demographic most vulnerable to these changes is often described by policy analysts as the “working middle” gap.

These are Minnesotans who:

• Earn too much to qualify for MinnesotaCare or Medical Assistance
• Earn too little to comfortably absorb a several-hundred-dollar premium increase
• Often lack employer-sponsored coverage

For these households, the expiration of enhanced subsidies did not represent a marginal adjustment. It represented a budgetary rupture.

A Question for 2027 and Beyond

Without renewed federal action, Minnesota could see the first sustained rise in its uninsured rate in years. State lawmakers may face increasing pressure to revisit MinnesotaCare eligibility thresholds or explore broader public-option style expansions to protect those priced out of the private market.

The enrollment season that just closed suggests that coverage losses were not the result of indifference. They were the product of cost.

For many Minnesotans, the expiration of enhanced federal savings did not erase the need for health insurance. It simply made the arithmetic harder.

MinneapoliMedia