How to Pick a Health Plan for 2027: Bigger HSAs, Higher Deductibles and Tax Rule Changes

Choosing health insurance through the Affordable Care Act is becoming more complicated each year. Prices and coverage can shift, and changing rules may also affect what you pay out of pocket.

For 2027, health savings account (HSA) contribution limits are going up, some deductibles and out-of-pocket caps are increasing, and tighter ACA premium tax credit rules could leave some households with higher costs. Before Marketplace open enrollment starts, here are the main updates to know and the mistakes to avoid.

What’s changing for HSAs

An HSA is a tax-advantaged account used for qualified medical expenses. You do not have to be a W-2 employee to open one. A 1099 worker, self-employed person or business owner can also qualify if an HSA-eligible health plan covers it, according to GoodRx.

People with qualifying high-deductible health plans will be able to contribute more in the coming year, which could be helpful:

• Up to $4,500 for individual coverage and $9,000 for family coverage, up from $4,400 and $8,750, according to Fidelity.

• Those age 55 and older can add a $1,000 catch-up contribution.

• The minimum deductible for an HSA-qualified plan also rises to $1,750 for individual coverage and $3,500 for family coverage.

The higher contribution limit can also mean meaningful tax savings. Someone in the 24% federal tax bracket who puts in the full $4,500 could potentially save about $1,080 in federal income taxes, before any payroll-tax savings, said Peter Diamond, a federally licensed tax, accounting, real estate and structure expert and certified bankability expert (CBE).

He called the HSA one of the best tax tools available because it can offer three advantages: a deduction on the way in, tax-deferred growth and tax-free withdrawals when the money is used for qualified medical expenses. The larger HSA limit can also matter for Marketplace shoppers because contributions can lower adjusted gross income, according to H&R Block. Louise Norris, health policy analyst for healthinsurance.org, said HSA contributions can reduce the income used to determine Marketplace subsidy eligibility, which could increase a premium tax credit or help someone qualify for one.

Be alert to higher Marketplace costs

According to KFF, temporary ACA tax credits were created during the pandemic to make coverage more affordable, but those credits expired in 2025, helping drive premiums higher. Another concern is repayment: if your income ends up higher than you expected, you may have to pay back the full amount of excess credits at tax time.

“Do not treat the Marketplace income estimate as insignificant,” Diamond said. “If your income changes during the year, update it because a subsidy today can become a tax bill tomorrow.”

He also pointed out that the affordability benchmark for employer coverage has changed. In 2027, the ACA affordability threshold is 10.22% of household income, according to the IRS. For a household earning $80,000, that works out to about $8,176 a year, or $681 a month.

Do not judge plans by the deductible alone

When comparing plans, the deductible is only one part of the total cost. Diamond said shoppers should pay attention to five figures:

• Annual premiums

• Deductible

• Copays and coinsurance

• Out-of-pocket maximum

• HSA and other tax benefits

For 2027, the federal maximum for applicable plans rises to $12,000 for individual coverage and $24,000 for family coverage, according to the National Insurance Services, although plans can set lower limits.

Diamond offered an example: a plan with a $450 monthly premium and an $8,700 out-of-pocket maximum could cost $14,100 in annual premiums and covered in-network medical expenses in a worst-case year. If someone contributes $4,500 to an HSA and is in the 24% federal tax bracket, they could save about $1,080 in federal income taxes, bringing the total to roughly $13,020.

“The premium, hospital exposure, coinsurance and maximum out-of-pocket cost are what determine how expensive the plan can actually become,” Diamond said.