“It’s within the power of congressional Republicans to rein in the cost of health coverage and protect access to quality, affordable health care,” writes health expert Sally Pipes. “But time is running out.”
Getty Images
Employers expect to see their health insurance costs surge by as much as 9.5% next year. That’s the biggest uptick since 2011.
President Trump’s tariffs deserve much of the blame. According to analysts, the threat of new levies on imported drugs and drug ingredients is one of the main factors leading insurers to raise prices. Just last week, the president said he’d impose 100% tariffs on imported pharmaceutical products starting October 1—unless a drug maker is building a manufacturing facility in the United States.
It’s time for Congress to reclaim its constitutionally granted authority over tariffs—and forestall these import levies. If Republican legislators do not, they’ll face an electorate next year that could be eager to punish those in power for needlessly forcing them to pay more for health care.
The cost of health insurance has been rising steadily for years, largely as a consequence of Obamacare’s heavy-handed insurance market regulations. But this time is different. Insurers blame two things in particular for rising costs.
The first is soaring demand for weight-loss medications like Ozempic and Wegovy. It’s estimated that 12% of U.S. adults have taken these medicines. Given that 40% of the adult population is obese, it’s a safe bet that demand will only increase.
Of course, GLP-1s are proving to be among the most effective drugs ever developed. They’re showing promise against everything from obesity and diabetes to cardiovascular disease and addiction.
A short-term spike in spending for GLP-1s could yield lower healthcare costs—and much healthier people—in the long run. Further, the cost of GLP-1s will soon fall when the branded medicines that currently dominate the market lose their patent protections and generics reach the market.
The second major factor behind rising insurance costs—Trump’s proposed tariffs—carries no such upside.
Most brand-name medicines that Americans take today are made elsewhere. The same is true of nearly 80% of generic drug tablets and capsules.
Even a modest tax on these vital imports could raise the cost of drugs dramatically. Health insurers and individual patients would find themselves facing significantly higher bills for products they need—and for which there may not be suitable substitutes.
In submitting their rates for 2026, many insurers cited tariffs specifically as a main reason they are hiking premiums. New York-based Independent Health Benefits Corporation (IHBC) explained their decision thusly: “IHBC is seeking an overall rate change of 18.9% in 2026, primarily due to increased costs due to inflation and tariffs.”
In Oregon, United Healthcare Insurance Company justified their 2026 premium increases as an attempt to “[t]o account for uncertainty regarding tariffs and/or the onshoring of manufacturing and their impact on total medical costs, most notably pharmaceuticals….”
Gargantuan premium increases will throw the finances of many businesses into disarray and send ripple effects through the economy. They will also create a political nightmare for congressional Republicans, particularly as the midterm elections approach.
After all, should health costs rise, it’s Republicans, with their unified control of government and their support for the president’s parade of tariffs, who will be held responsible.
Large majorities of Americans recognize that tariffs are a threat to their financial well-being. According to one recent Gallup poll, 89% of adults—including 82% of Republicans—think that tariffs are likely to result in higher prices on the products they buy.
Economics 101 says they’re right, of course—and the impending spike in health insurance costs is just the latest evidence of this fact. It’s within the power of congressional Republicans to rein in the cost of health coverage and protect access to quality, affordable health care for millions of American patients. But time is running out.