How Tennessee contractors are dealing with a 37.5% rise in health insurance prices

Sam Jaber, Licensed Health Insurance Advisor · Updated October 2026 · Last reviewed October 1, 2026

NPN 20698748 · Licensed in Tennessee and in more than 30 states in total · Licensing details

Short answer: When your contracting profits fall within the tax credit limits, HealthCare.gov will usually cost you less. Go above that threshold, and you're facing the full marketplace premium after an average 37.5% increase. Tennessee's marketplace medical plans are all EPOs, so contractors in good health should also compare medically underwritten nationwide PPO coverage. We can sort through that on a quick call.

• My profit qualifies for a credit
• My jobs put me over the line
• I'm over it and healthy
• Someone needs ongoing care
• My job plan or COBRA is ending
• My spouse has benefits
• Not sure yet

Maybe you own a Tennessee construction business, operate an electrical or HVAC company, or manage crews doing concrete, framing, or general contracting. Your revenue follows the work. You collect a deposit after signing, receive progress draws when inspections are completed, and get the remaining balance when the project finishes. Sometimes the customer holds retainage until everything is closed. Meanwhile, you're covering material purchases and paying your workers before all that money arrives.

You're already paying your own health insurance premiums, and that expense increased considerably. Average Tennessee marketplace rates jumped approximately 37.5% for 2026. The monthly cost of the benchmark silver plan for someone age 40 increased from $516 to $711.

Start by figuring out whether your expected income from this year's projects falls below or above the premium tax credit cutoff. That single answer tells you which of the following situations applies to your business.

If this year's jobs leave you under the credit line

HealthCare.gov handles marketplace enrollment in Tennessee. If your projected household earnings qualify for federal premium credits, coverage purchased there will generally have the lowest monthly cost. Those credits reduce your premium directly each month and cannot be applied to plans purchased elsewhere.

As a contractor, focus on net profit rather than total contract revenue. What matters is what remains after paying for materials, subcontractors and your crew. Timing can change everything. A final payment on a major project or retainage arriving in December might push an otherwise moderate year above the credit limit. That's 400% of the poverty guideline, or $63,840 of income for one person in 2027, versus $62,600 in 2026. Crossing it eliminates your annual credit, and advance payments are reconciled when you file taxes, potentially requiring full repayment. How the subsidy cliff works breaks down the cutoff.

If you know a substantial job payment is coming before year-end, revise your HealthCare.gov income estimate immediately rather than waiting until tax filing.

If your contracts put you past the line

Once your income exceeds the subsidy limit, you're responsible for the entire HealthCare.gov premium, which increased sharply in Tennessee. For a 40-year-old, benchmark coverage now costs $195 more each month than in 2025, or approximately $2,340 extra annually. Marketplace premiums also increase with age, making the burden greater for established business owners. Two 50-year-olds in a typical Tennessee county face a benchmark silver premium of roughly $2,000 monthly for 2026. That's about $24,000 annually coming directly from their contracting profits.

These are statewide averages and illustrative county figures, not personalized premium quotes. Your actual rate depends on your county, the ages being covered, and your selected policy.

For many contractors who don't qualify for credits, paying that entire premium isn't realistic. Your medical history becomes the next factor to consider.

If you're past the line and in good health

Tennessee marketplace coverage also comes with network restrictions. In 2026, every medical plan sold on it is an EPO, with no PPO medical choices. EPO policies generally won't cover services from providers outside their networks except emergencies. That's important when your contracts take you into Georgia, Mississippi or Virginia, or when you're traveling to visit relatives.

Contractors in good health can also explore coverage sold away from HealthCare.gov, including medically underwritten private plans with PPO provider networks spanning the country.

With medical underwriting, an insurer reviews the health information on your application before deciding whether to approve you, reject the application, or exclude an existing condition. Unlike marketplace insurers that must accept applicants, these companies can select their members. That allows them to offer different pricing to healthier applicants, sometimes below Tennessee's full marketplace premiums. A nationwide PPO network also gives you access to participating physicians across state borders rather than restricting your network to your home area.

Coverage and benefits vary among these private policies, so examine the details carefully before enrolling. You can read Our explainer on medical underwriting to understand each stage of the application.

Think about this the way you'd evaluate competing construction bids. Compare the actual premiums for your household under both options. Putting an underwritten quote beside the unsubsidized marketplace rate often clarifies which makes financial sense.

If you or someone on your plan needs ongoing treatment

One major advantage of marketplace coverage is that applicants are accepted at standard premiums regardless of medical history. Still, having an existing condition doesn't automatically mean private coverage is off the table. Sam Jaber can review both possibilities with you before you decide.

Tennessee had six marketplace insurers offering coverage in 2026. One has already announced plans to exit after the year ends, meaning 2027 choices will change. Availability also differs between counties. Because these policies use EPO networks, verify participation by your preferred doctors, hospitals, and pharmacies before selecting coverage.

If your job plan or COBRA runs out soon

You might be starting your own crew after working for a bigger construction company. Or perhaps the COBRA coverage from your previous position is nearly exhausted. In either situation, you have a specific termination date and need replacement insurance effective immediately afterward.

When employer coverage ends, including the exhaustion of COBRA benefits, you receive a 60-day opportunity to enroll through HealthCare.gov outside the usual enrollment period. Choosing the replacement still depends on your projected income and health. If your first year's profits qualify for credits, marketplace coverage is the likely direction. Otherwise, if you're healthy, begin the underwritten application ahead of time because coverage cannot start until you're approved.

If your spouse works somewhere with benefits

If you're married, your household may have another possibility: health benefits through your spouse's employer. When family coverage is offered, compare that premium with marketplace coverage and, if you're both healthy, medically underwritten alternatives.

There's an important deduction rule here. During months when you're eligible for an employer-sponsored health plan with an employer contribution, even through your spouse, you cannot claim the self-employed health insurance deduction. Your accountant can explain your situation, and Our guide to the deduction provides additional information.

Pick the row that sounds like your business

Whichever category describes your situation, the next move is straightforward. Talking through your real figures briefly is usually faster than trying to calculate everything yourself.

For broader information about coverage options and rules, visit the Tennessee guide for self-employed buyers. Business owners operating practices just south of Tennessee experienced an even larger increase. Read see how Mississippi practice owners are handling it.

Questions from Tennessee contractors