Workers with job-based health insurance are bracing for the steepest premium increase in more than two decades. A new survey from benefits consultant Marsh projects that employer health plan costs will rise 8.2% in 2027 even after companies trim benefits to soften the blow, the largest such increase since 2003. For a household already juggling rent, groceries and gas, that points to bigger paycheck deductions, higher deductibles, or both, showing up as soon as this fall’s open enrollment.
Marsh’s Survey: 8.2% After Cuts, 11% If Nothing Changes
Marsh’s preliminary results from its 2026 National Survey of Employer-Sponsored Health Plans, drawn from more than 1,800 employers surveyed through Aug. 10, found that companies expect their health benefit costs to climb 11% in 2027 if they change nothing about their plans. After factoring in the plan design changes employers say they will actually make, that number settles at 8.2%, still the highest increase since 2003 and the fifth straight year of rising costs after a decade of milder increases. Marsh’s Beth Umland, director of employer research for health and benefits, put it bluntly in comments to reporters: this year was rough, and next year looks rougher.
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Nearly Six in Ten Employers Plan to Shift Some of the Cost
Companies aren’t absorbing the increase quietly. In the Marsh survey, 59% of employers said they plan to make cost-cutting changes to their health benefits for 2027, from raising deductibles and copays to steering workers toward narrower provider networks. Some are dropping coverage for GLP-1 weight-loss drugs outright; others are tightening the rules on who qualifies. That matters for anyone on a company health plan because plan design changes are exactly how the cost your employer avoids becomes the cost you pay instead, whether it shows up as a higher paycheck deduction, a bigger deductible, or a smaller list of in-network doctors.
Aon and Business Group on Health Are Seeing the Same Squeeze
Marsh isn’t alone in flagging this. Insurance broker Aon, in an Aug. 20 report, projected a 9.5% cost increase for 2027, pushing average health spending above $19,000 per employee and marking the fourth straight year of near-double-digit growth. Aon’s data also shows workers are already paying more out of pocket now: an average of $2,167 in 2026, up 10.2% from the year before, on top of $3,130 in premium deductions taken straight from paychecks. “Employers have now experienced several consecutive years of health care cost increases that are approaching double digits,” said Mike Pasterick, Aon’s North America Health Solutions leader, adding that the pressure now shapes far more than a single year’s budget. Separately, Business Group on Health, a coalition representing large employers, found in its own Aug. 25 executive summary that its members expect a 9.2% median cost trend for 2027, easing to 8% once plan changes are applied, with cumulative costs up 76% from 2018 through 2027, roughly double the pace of general inflation over that span.
GLP-1 Drugs and a New Dispute-Resolution Loophole Are Driving Costs
The reasons behind the increase are fairly consistent across all three surveys. Marsh’s actuaries estimate that rising use of GLP-1 medications alone accounts for a full percentage point of the 2027 cost growth. Hospital and provider consolidation, which reduces competition and lets systems raise prices, is another repeat culprit; Business Group on Health found 62% of its member employers say hospital price increases are driving their costs to a great or very great extent. A less obvious driver is the Independent Dispute Resolution process created under the federal No Surprises Act, which was meant to protect patients from surprise medical bills but has become a venue where out-of-network doctors challenge what insurers pay them. Nearly half of employers in the Business Group on Health survey said they’re already seeing, or expect to see, a high volume of these disputes drive their costs up in 2027.
What It Means for the 154 Million People on Job-Based Coverage
Employer-sponsored insurance is how most working-age Americans get health coverage. KFF’s most recent annual survey puts the number at roughly 154 million people under 65, with average 2025 premiums already at $9,325 for single coverage and $26,993 for family coverage. If the 2027 projections hold, the next round of open enrollment paperwork will likely show a bigger number withheld from every paycheck, alongside higher deductibles for anyone who actually uses the plan. Employers absorb most of the increase, but not all of it, and the gap tends to land hardest on people managing a chronic condition, a new baby, or a family plan that was already the single biggest line item in the household budget after housing.
This article was produced with AI assistance and reviewed by a human editor. Figures are linked to their primary sources; where a claim could not be verified from the public record, we say so.
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