Employer health benefit costs projected to jump 8.2% in 2027
Consulting firm Marsh forecasts that employer-sponsored health insurance expenses will rise 8.2% next year, the steepest increase since 2003.
According to a report released this week, Marsh predicts employer health benefit costs will climb 8.2% in 2027, the biggest year-over-year increase since 2003. The firm attributes the rise to several pressures: consolidation of hospital networks giving providers more pricing power, the high price of advanced treatments like cancer therapies, and the growing inclusion of expensive GLP-1 weight-loss drugs in plans. A further percentage point each stems from rapid AI adoption by providers to identify additional billable services and from a surge in No Surprises Act disputes that often end in large payouts.
Marsh notes that government health funding is not keeping pace with inflation, pushing private insurers to shoulder more costs. Surveyed employers say they will prioritize managing high-cost claims and evaluating program performance to contain expenses, though they warn that without action, plan costs could rise about 11% on average.
Why it matters
Rising employer health costs could strain corporate budgets and affect workers' insurance coverage.
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