Healthcare costs in the United States, which has the most expensive healthcare system in the world, will soon rise. In the coming weeks, about 160 million Americans with employer-sponsored health insurance will enter their benefits portals and select plans for 2027.
This cost increase is projected to be an average of 8 to 10 percent, marking the largest increase in over 20 years and double the average cost increases of the 2010s.
History and Consequences of Cost Increases
This increase is the second phase of three consecutive shocks to healthcare costs and insurance coverage. The first shock occurred in January 2026, when 24.3 million people enrolled in the ACA insurance market experienced an average 114 percent increase in their premiums after receiving subsidies. The second shock involves a sharp increase in premiums and out-of-pocket costs for those with employer insurance, which is also rising for the third consecutive year. The third shock will begin next January when Medicaid work reporting requirements are implemented, which is expected to disenroll about 6 million people from coverage.
Impact of Cost Increases on Insurers
Estimates indicate that this decision has raised post-subsidy premiums by an average of 114 percent, equivalent to about $1,000 per year. In response to this increase, some individuals left the market, and enrollment decreased by 12 percent. Additionally, the average premium paid by individuals in the markets reached $178 per month in 2026, which is 58 percent higher than in 2025 and above $164 in 2021.
These cost increases directly impact employees, as employers have also changed their plans to reduce expenses. One common change is the increase in deductibles, which shifts costs onto employees. Furthermore, employers' share of coverage for new medications has also decreased.
This situation indicates that we are currently in the midst of a significant rise in healthcare costs. In this context, these shocks may present an opportunity for a new generation of reforms in the American healthcare system.
