Employers across the U.S. are likely to face sharply higher health insurance costs next year, which could drive up how much workers pay for medical coverage, according to a recent survey.
Health benefits consulting firm Marsh projects that the total health benefit cost per employee, which measures both employer and employee premium contributions, will rise by an average of 8.2% in 2027, the steepest increase since 2003.
That forecast factors in cost-saving steps employers plan to take, such as raising deductibles, which typically lower monthly premiums for employees but increase their out-of-pocket costs. Without those measures, employers said their health plan costs would increase by 11% on average, according to Marsh.
The projections are based on a national survey Marsh fielded over the summer on employer-sponsored health plans.
The cost of employer-sponsored health plans has surged in recent decades, according to nonprofit health policy researcher KFF, driven largely by the higher treatment costs for serious illnesses such as cancer. The number of health providers has also shrunk, giving them greater leverage when negotiating plan costs with insurers, Marsh notes.
Soaring prescription drug prices are also playing a role, with new treatments such as GLP-1 drugs driving up healthcare expenses. That comes as more companies cover the cost of the drugs, which are increasingly used for weight loss.
By contrast, rising GLP-1 costs have prompted some employers to withdraw coverage, while others are implementing stricter qualification requirements to mitigate spending, Beth Umland, director of employer research for health and benefits at Marsh, told CBS News in an email.
Will employees pay more for health benefits?
Employers typically absorb only around 80% of health plan costs, with workers shouldering the rest.
“That split has been roughly consistent over time, like over a long period of time, over 20 years,” Matthew Rae, associate director of the healthcare marketplace at KFF, told CBS News. “Historically, when premiums have gone up, workers and employers have sort of shared the burden.”
Although some employers may absorb more health care costs due to industry dynamics and other factors, many workers are likely to pay more for medical coverage, Rae said. “That’s been the pattern historically, but employers pay more, too.”
Umland also expects health costs to rise for employees in 2027.
“It is fair to say that most employees will spend more on healthcare next year, with both higher paycheck deductions and higher out-of-pocket costs,” she said. “Employers have been trying to avoid shifting health costs to employees in recent years, but after a few years of elevated cost increases, many will feel they have no choice.”
According to Marsh’s survey, 59% of employers plan to make cost-cutting changes to health benefits next year, such as raising deductibles, which can raise out-of-pocket costs for workers.
Employees may also face higher premium payments. About two-thirds of large employers expect to increase employees’ share of premium costs next year, according to an earlier Marsh survey.
How much are employees spending?
An August forecast from insurance broker and consulting firm Aon forecasts workers will spend an average of $3,130 this year on health plan premiums and $2,167 on out-of-pocket costs, raising their total annual health insurance bill to nearly $5,300.
That would represent a 7.9% increase from last year’s total of $4,909 and amount to the largest percentage increase in a decade, according to an Aon spokesperson.
The projected rise would add to the financial pressure facing millions of Americans as they prepare for open enrollment season, which typically falls between September and November. Around two-thirds of people under age 65, roughly 165 million people, had employer-sponsored health insurance in 2025, according to KFF.
