Employer Health Costs Projected to Increase by 9.5% in 2027

Employers are expected to face continued health cost increases in 2027, with projections from benefits consultant Aon indicating a rise of 9.5%. This increase will bring the average employer health care cost to over $19,000 per employee. Factors contributing to this rise include increased demand for health services, a higher prevalence of chronic diseases, and the growing use of medications such as GLP-1s. Workers are projected to pay an average of $5,297 for health coverage this year, which is $388 more than in 2025. Additionally, the increased use of artificial intelligence in billing and coding is contributing to higher charges. Since 2022, employer health care cost increases have more than doubled, from 3.7% to 8.8% in 2026. Employers, who typically cover about 82% of health plan costs, are exploring changes to benefits and cost-management strategies to mitigate these increases, although there are concerns about potential backlash from employees regarding these cost-control measures.