Employer Health Plans Are Set to Become More Expensive in 2027

People enrolling in employer-sponsored health coverage for 2027 may find the price hard to swallow.

Premiums are expected to climb for a fourth straight year, and workers will likely face higher costs when they get care as well. Those increases would add more strain to household budgets already under pressure, deepening the affordability problem that has become a major issue ahead of the next midterm elections.

According to Aon, employers’ healthcare costs are projected to rise 9.5% next year, though many companies are expected to adjust benefits in an effort to soften the impact. The forecast matches those from other consulting firms and industry groups.

After years of relatively modest medical inflation, employers are now confronting an extended stretch of higher costs driven by greater use of healthcare services, expensive cancer treatments and other therapies, and continued demand for costly obesity drugs, among other factors.

Workers are likely to feel the effects too, because employers have already used many of the tools available to rein in expenses and may have to take more significant steps, said Todor Penev, head of US health analytics at Aon.

“The affordability crisis is real,” he said. “It’s going to be much more noticeable with annual enrollment.”

This year, workers’ share of health insurance premiums rose 9% on average to nearly $7,500 for family coverage, according to KFF’s Employer Health Benefits Survey. During the same period, average wage increases were only 3.7%, KFF said.

At OSI Packaging in Shreveport, Louisiana, employees saw premiums rise to $300 a month in 2026, up $100 from the previous year, said controller Julie Eason. But the company, which has six workers in its health plan, was able to keep out-of-pocket costs unchanged.

The packaging material and equipment distributor and service provider began offering health coverage in May 2025 to help fill job openings. OSI wants to keep coverage strong and affordable, but if costs rise again next year, Eason said the company may have to make difficult decisions.

If that happens, workers will help decide whether premiums or copays should go up.

“It’s their healthcare,” she said. “It’s only right to let them decide.”

At the University Club of Michigan State University, Debbie Barosko faces a tough choice of her own. The human resources director must decide whether employees will see a nearly 13% increase in premiums while keeping the same $1,000 deductible, or whether raising the deductible to $1,500 would limit the premium increase to about 7%.

The 30 workers on the plan already dealt with a 9% premium increase and a doubling of their deductible this year after the club’s longtime insurer stopped operating.

Barosko is weighing whether to keep the deductible lower, which helps with recruiting, or raise it to reduce costs for both employees and the club.

“It’s hard to stomach for the employees and the employer when you’re increasing the premiums but diluting the benefits,” she said.

More employers are dropping weight-loss drug coverage

Workers will need to pay closer attention to their options and how they use their benefits in the year ahead. They may find lower copays when they use doctors in newly designated preferred networks, and they should also check whether their prescription out-of-pocket costs have changed.

“The likelihood that people will see changes makes it critically important for them to invest the time to understand what the changes mean for them,” said Jim Winkler, chief strategy officer at the Business Group on Health, an employer advocacy organization.

One notable shift is that fewer employers are covering GLP-1 drugs for weight loss, since they are a major driver of higher costs, according to the group, whose members are largely large employers. Coverage fell to 60% this year from 72% in 2025, and the group has not heard of any companies newly adding coverage for weight loss use.

Americans now have more ways to buy the highly popular weight-loss drugs, including Eli Lilly’s Zepbound and Foundayo and Novo’s Wegovy. The manufacturers offer discounted prices for people who pay cash instead of using insurance, with prices ranging from $149 to $699 depending on the medication and dose.

“What’s increasing is the number of options that employers see either for themselves or for their members to access these drugs outside of the traditional covered channels,” said Magda Rusinowski, vice president at the Business Group on Health.

Some employers are exploring ways to help workers buy GLP-1 weight-loss drugs directly from manufacturers or other partners, such as Costco’s pharmacy, said Matthew Rae, associate director at KFF. Companies could also help subsidize those purchases through Health Reimbursement Arrangements, or HRAs.

“Ultimately, employers offer health benefits that they hope employees will value, and many employees see GLP-1 coverage as an important part of that,” he said. “If they can find ways to provide that coverage at a lower cost, they’re likely to do it.”