Employer Health Benefit Costs Jump 8.2% in 2027, Highest Since 2003
Updated
Updated · Mercer · Aug 24
Employer Health Benefit Costs Jump 8.2% in 2027, Highest Since 2003
3 articles · Updated · Mercer · Aug 24
Summary
An early survey of more than 1,800 employers projects average health benefit costs per employee will rise 8.2% in 2027, up from a 6.7% projected increase for 2026 and marking a fifth straight year of elevated growth.
Employers said current plans would cost 11% more without intervention, with actuaries attributing about 1 percentage point each to rising GLP-1 use, AI-assisted claims submissions and No Surprises Act dispute awards.
Fifty-nine percent of employers plan cost-cutting benefit changes for 2027, including higher deductibles, while an earlier Marsh survey found about two-thirds of large employers expect to raise workers' premium contributions.
The pressure is also pushing employers toward quality-focused options such as variable copay plans, which 12% of large employers expect to offer in 2027, as sponsors try to curb high-cost claims without simply shifting costs to staff.