Jesse Smedley is a Principal of Oakbridge Insurance and the founder of iHealthBrokers. He founded iHealthBrokers in 2007, and Oakbridge acquired iHealthBrokers in 2025. He has spent nearly two decades teaching people how to save money on their health insurance and navigate Medicare, and he is the author of Medicare A to Z: Your Roadmap to Medicare.
Health insurance is expensive, and for many people it got more expensive in 2026. The good news is there are still discounts and tax breaks that often get overlooked. Here are five ways to lower your costs, and how combining them can add up to real savings.
Understanding Health Insurance Costs
First, a quick look at what you’re paying for. You pay a monthly premium to keep your coverage active.
When you use your insurance, you usually pay your deductible first. That’s the amount you pay out of pocket before the plan starts covering costs.
After that comes cost sharing. A copay is a fixed amount for a specific service, and coinsurance is a percentage of the cost.
Your plan tracks your spending until you reach your out-of-pocket maximum, the most you’ll pay for covered in-network services in a year. For a refresher on these terms, see How Health Insurance Works.
1. Premium Tax Credits
If you buy coverage through the ACA Marketplace, premium tax credits can lower your monthly premium based on your household income.
From 2021 through 2025, the American Rescue Plan Act and the Inflation Reduction Act expanded these credits. Many people qualified for plans under $10 a month, and the income cap at 400% of the federal poverty level (FPL) was temporarily removed. Those enhanced credits expired at the end of 2025, and Congress has not restored them.
That means for 2027 coverage:
- Premium tax credits are still available, but they’re generally smaller than before.
- If your household income is above 400% FPL, you no longer qualify for a premium tax credit and pay the full premium.
- Small changes in income can make a big difference, especially near the 400% line.
Learn more in The ACA Subsidy Cliff Is Back: What It Means for You. Open Enrollment for 2027 coverage on HealthCare.gov runs November 1, 2026 to January 15, 2027. Enroll by December 15 for coverage that starts January 1.
2. Cost-Sharing Reductions (CSRs)
Premium tax credits lower your premium. Cost-sharing reductions lower what you pay when you actually use your coverage: your deductible, copays, coinsurance and out-of-pocket maximum.
If your income is between 100% and 250% FPL and you choose a Silver plan on the Marketplace, you may qualify. At the lower end of that range, a Silver plan with CSRs can cover a higher share of costs than a Gold or even Platinum plan. Combined with a premium tax credit, that can save you thousands of dollars a year.
For lower-income families, also check whether you qualify for Medicaid or CHIP. Our ACA guide explains how Marketplace savings work.
3. Tax Breaks for the Self-Employed and Small Business Owners
If you’re self-employed, you may be able to deduct your health insurance premiums.
A Health Savings Account (HSA) is another strong option if you have an HSA-eligible plan. HSAs offer a triple tax advantage:
- Contributions are tax-deductible (or pre-tax through payroll).
- The money can be invested and grows tax-free, and unused funds roll over every year.
- Withdrawals for qualified medical expenses are tax-free.
Because deductible HSA contributions lower your income for Marketplace purposes, they can also help you qualify for a larger premium tax credit or cost-sharing reductions.
Starting in 2026, Bronze and catastrophic Marketplace plans count as HSA-eligible, which opens HSAs up to many more people. The 2027 contribution limits are $4,500 for self-only coverage and $9,000 for family coverage.
After age 65, you can withdraw HSA money for non-medical expenses without the 20% penalty. You’ll pay income tax on those withdrawals, similar to a traditional IRA. Once you enroll in Medicare, you can no longer contribute, but you can keep using the money. Learn more in Secrets to Retire a Millionaire with HSA.
Small employers can also look at Health Reimbursement Arrangements (HRAs), such as an Individual Coverage HRA (ICHRA) or a Qualified Small Employer HRA (QSEHRA). These let an employer make tax-free contributions toward employees’ individual health insurance premiums and medical costs, and they can work well for small businesses. See our group health insurance page for more options.
4. Employer-Sponsored Health Insurance Perks
If you have coverage through work, check your HR portal or ask your HR manager what’s available. Your employer may offer wellness programs, HSA matching contributions or premium discounts for completing a health assessment or biometric screening.
5. Prescription Savings
Prescription prices can vary a lot from one pharmacy to the next, so it pays to compare. Some pharmacy chains offer certain common generics free or at a very low cost.
Discount programs and apps such as GoodRx, SingleCare and Cost Plus Drugs can sometimes cost less than your insurance copay. Keep in mind that what you pay through a discount program usually doesn’t count toward your plan’s deductible.
When you shop for a Marketplace plan on HealthCare.gov, you can also enter your medications to see which plans cover them. Many states and drug manufacturers have assistance programs that offer additional discounts as well.
Get Help Lowering Your Health Insurance Costs
The right plan depends on your income, your doctors and your prescriptions. Our licensed brokers can compare your options and check which savings you qualify for at no cost to you. Get your free quotes or call us at (866) 260-9829.
