Employee health insurance premiums to rise 6% in 2026, survey finds

(NewsNation) — Americans with employer-based health insurance could see monthly premiums rise 6% to 7% in 2026, according to a new report from consulting firm Mercer.

That projection comes from a survey of over 1,700 U.S. companies, which expect the average cost of health plans for employers to climb 6.5% next year — the steepest increase since 2010.

As plan costs go up, the employee share of the premium typically rises proportionally, Mercer said.

If the forecast holds, it would mark the fourth straight year of significantly higher health insurance costs for employers following a decade of more moderate annual increases averaging about 3%, the report noted.

In response, nearly 60% of employers plan to make cost-cutting changes to their health plans in 2026. Generally, that means raising deductibles and other cost-sharing provisions, which can leave workers with higher out-of-pocket costs when they seek care.

For employers that don't make changes, Mercer estimates plan costs will increase by nearly 9%, on average.

Two forces are driving costs higher: the rising price of care and greater use of services.

On the price pressures side, higher wages across the health care sector have made providing care more expensive. At the same time, new advances in cancer treatments and weight-loss drugs tend to cost more than the treatments they replaced. Recent investments in AI may be another source of pressure, the report noted.

Utilization rates have also been ticking up, in part because of delayed or missed care during the COVID-19 pandemic, Mercer said. The rise of virtual care is contributing as well, since it eliminates geographic barriers and improves access to doctors.

Some health insurance companies have cited President Donald Trump's tariffs as a reason for raising premiums, according to KFF, a nonprofit health policy research group.

So far, employers have borne much of the premium hike in recent years, while the amount that workers’ pay has been little changed, up about 5% since 2019, per KFF.

In 2024, the average health insurance premium for families hit $25,572 a year, up 7% for the second year in a row. Of that, workers contributed an average of $6,296 while employers contributed $19,276, KFF research shows.

Many employers surveyed by Mercer said they plan to pursue strategies to slow cost growth without passing the cost on to employees, specifically by addressing high-cost claims through enhanced case management.