Last week I wrote about why insurance is the wrong mechanism for chronic care. When a third party stands between the patient and the bill for everything, prices inflate to capture that payment. Routine care stops being routine. The whole system bends around the payer, not the person.
But let's extend the indictment. Because even if you accept all of that, the implicit promise has always been: fine, maybe insurance is clunky for the everyday stuff, but at least I'm covered when something catastrophic happens. When the thing insurance was actually invented for finally shows up, I'm protected.
That promise is breaking down too.
You are paying to pay more
The average family now pays nearly $27,000 a year in premiums for employer-sponsored coverage. Before a single claim is filed. Before a single deductible is met. The federal poverty line for a family of three is $26,650. The insurance itself costs more than that.
Then comes the deductible, what you pay out of pocket before insurance starts covering your costs. The average family deductible runs over $3,700, which means most families spend the first part of every year paying full freight anyway before insurance activates. Then there's the out-of-pocket maximum. Then coinsurance. Then whatever falls outside formulary or network. By the time the math resolves, a family is routinely spending thousands more annually on top of a premium that already exceeds the poverty line.
You are paying to pay more.
Fine, you might say. That's the cost of being protected when the catastrophic thing happens. Except the catastrophic thing is increasingly not being covered either.
The catastrophic thing isn't covered either
ACA marketplace insurers denied nearly one in five in-network claims in 2024. In-network. The care your plan is supposed to cover. The most common reason cited? "Other." A category that accounts for more than a third of all denials, followed closely by administrative reasons. Only 5% of denials were for lack of medical necessity, meaning the overwhelming majority of people who got denied weren't denied because the care wasn't warranted. They were denied for reasons their insurer couldn't or wouldn't articulate.
Almost nobody fights it. Fewer than 1% of denied claims get appealed, not because people are satisfied with the outcome, but because the system is designed to make fighting back feel like a second job. And when people do appeal, they win the majority of the time. The insurer was wrong. They just counted on you not knowing that, or not having the energy to prove it.
People are leaving
Premiums have grown 77% over the last five years for a standard Silver plan. They are outpacing wages. They are outpacing inflation. The uninsured population grew by 670,000 in 2024, and that number has since accelerated sharply. When Congress let enhanced subsidies expire at the end of 2025, ACA marketplace enrollment fell by 1.2 million in a single enrollment cycle, the steepest single-year drop since the marketplaces launched. Average monthly premiums jumped 58%. Nearly 5 million more enrollees are projected to lose coverage mid-year because they simply cannot keep up with payments. Among people who had marketplace coverage in 2025, roughly 1 in 10 are now uninsured. And of those who stayed, the most common move was to trade down into bronze plans, which carry deductibles that routinely exceed $10,000, buying the appearance of coverage while absorbing almost all of the actual risk themselves. Bronze plan enrollment jumped from 30% of all selections to 40% in a single year.
People are making the rational economic calculation that the product no longer justifies the price.
That's the part worth sitting with. Not that insurance is expensive, which everyone knows. But that people are looking at the cost, looking at the coverage, and concluding that they're better off without it. That is not a failure of consumer behavior. That is a product failing its users so consistently that the rational response is to leave.
The value proposition is gone
Insurance was designed to be the backstop. The thing that caught you when nothing else could. It has become something you pay more for every year, that denies a significant fraction of the claims you file, that still leaves you exposed to thousands in costs when something does go through, and that reserves the right to say no in language it won't explain.
The value proposition isn't unclear. It's gone.