Employer and worker health plan costs expected to jump in 2027
Summary
Health insurance costs for employers and workers are expected to rise sharply in 2027, with an average increase of about 8.2%. Employers plan to raise deductibles and share more of the cost increases with employees, which will result in higher out-of-pocket expenses and premium payments for many workers.Key Facts
- Total health benefit costs per employee are projected to increase by 8.2% in 2027, the biggest jump since 2003.
- Without employer cost-saving steps like higher deductibles, costs would rise by 11% on average.
- Higher treatment costs for serious illnesses and rising drug prices, especially for new drugs like GLP-1, are major drivers of increasing costs.
- About 59% of employers plan to raise deductibles or make other cost-cutting changes that can increase employees’ expenses.
- Two-thirds of large employers expect to increase the share of premium costs paid by employees.
- Workers typically pay about 20% of health plan costs, a ratio that has stayed stable over the last 20 years.
- Employees’ total health insurance costs, including premiums and out-of-pocket expenses, are forecasted to rise to nearly $5,300 in 2027, up 7.9% from last year.
- Around 165 million Americans under age 65 had employer-sponsored health insurance in 2025.
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