A survey of employers predicts the largest spike in health care costs in more than two decades: an 8.2 percent increase in 2027 compared to this year’s costs for employer-sponsored health insurance.
The consulting firm Marsh surveyed more than 1,800 employers about the costs they expect next year. The answers pointed to several specific drivers of skyrocketing health insurance costs, and an overall increase higher than any year since 2003.
The projected rise in costs comes on top of big increases in costs in recent years for both employer-sponsored health insurance and health care marketplace plans.
Marsh attributed a full percentage point of the eight-point projected increase to the widespread uptake of GLP-1 weight-loss drugs, which are costly to the employers who choose to cover them on their health insurance plans.
Another percentage point, the firm said, is due to medical providers’ increased use of artificial intelligence to find more claims they can bill for.
And another point comes from the dispute-resolution process enacted under federal law that took effect in 2022, which has unexpectedly led to millions of disputes over medical billing, often resolved in favor of huge payouts to doctors and physician assistants. Members of Congress have proposed modifying the law.
Consolidation of hospital systems and increasingly sophisticated cancer care options play a role in rising costs too.
Workers will end up bearing some of the new costs, in the form of both higher premiums for their insurance plans and reductions in coverage.
Many employers told Marsh that they’re trying to keep costs down; without any modifications to the insurance they offer, the cost would go up on average 11 percent next year, not 8.2 percent, they said.
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