Business · Economy · 3 hrs ago
US Employers Face an 8.2% Rise in Health Benefit Costs in 2027
A Mercer study projects US health benefit costs per employee will rise 8.2% in 2027, the biggest increase since 2003.
Employers told Mercer costs could rise about 11% without planned steps to reduce them.
At the same time, workers are paying a growing share through paycheck deductions.
Some employers, especially small businesses, can consider individual coverage health reimbursement arrangements, which reimburse workers for insurance they buy themselves.
Health savings accounts let workers use pre-tax savings for medical expenses, and employees can keep the money if they change jobs.
Some smaller companies are also self-insuring, covering claims up to a limit and buying insurance for larger claims.
These options may help manage costs without simply passing increases to workers, though the account says no single approach suits every employer.
US employers’ health benefit costs per employee are expected to rise 8.2% in 2027, after planned cost-reduction measures.
Without those measures, employers told Mercer they expected costs to rise about 11%.
Mercer’s projected increase would be the highest since 2003.
The Guardian article says employers are shifting a growing share of healthcare costs to workers and describes other ways employers could manage costs.
- Who
- US employers and their employees.
- What
- Employers’ health benefit costs per employee are expected to rise 8.2% in 2027 after planned cost reductions.
- When
- 2027.
- Where
- United States.
- Why
- Not stated.
US employers shifting costs to employees
Guardian article advocating alternatives
Cost management
US employers shifting costs to employees
Employers are passing a growing share of healthcare costs to workers.
Guardian article advocating alternatives
The article argues employers could instead consider options such as ICHRAs, HSAs and self-insurance.
The projected 2027 increase would be the highest since this year.
Mercer projects an 8.2% rise in health benefit cost per employee after employers’ planned cost-reduction measures.
- Projected increase
- 8.2% per employee in 2027
- Without planned measures
- About 11% expected increase, according to employers
- Previous high
- 2003
- Small companies without health benefits
- 44% do not provide any health benefits
- Adoption growth
- ICHRA adoption grew 73% to 128% among employers with fewer than 100 employees
What people are saying
is the right approach to pass these cost increases to employees?
An HRA isn’t for everyone.