Health Insurance Costs Keep Soaring As Workers Pay More Out Of Pocket: 'Healthcare Costs Have Never Been Higher'
Market commentator The Kobeissi Letter warned that the surge in U.S. health insurance costs shows no signs of slowing, signaling growing financial pressure on both employers and workers.
Health Costs Surge
In a post on X on Sunday, The Kobeissi Letter cited a recent report from Mercer showing health benefit costs per employee are expected to rise 6.7% year-over-year in 2026 to at least $18,500, marking the biggest annual increase in 15 years.
The Mercer report, released on June 11, found health insurers are also expected to raise the cost of employer group plans by more than 6% for the fourth consecutive year. Nearly half of large U.S. employers are expected to raise deductibles, copays or other out-of-pocket costs for workers in 2027.
The Kobeissi Letter added that around 66% of large U.S. firms may increase monthly employee premium contributions next year, while workers who frequently visit doctors and fill prescriptions could see healthcare costs rise by as much as 8% year-over-year.
"U.S. healthcare costs have never been higher," The Kobeissi Letter wrote.
Coverage Isn't Solving The Affordability Problem
Mercer also found that employers are increasingly redesigning health plans to control spending. About 31% of large employers already offer or plan to offer non-traditional plans in 2027, such as high-performance networks or variable copay models that reduce costs when workers use approved providers.
The rising costs are being driven partly by expensive prescription drugs, including specialty medications, gene therapies and GLP-1 treatments such as Ozempic and Wegovy, with prescription drug benefit costs alone expected to rise around 9% in 2026. Mercer found 6% of large employers dropped weight-loss GLP-1 coverage in 2026, while 27% tightened utilization controls amid rising costs.
Policymakers are also targeting prescription drug inflation. The Trump administration said its drug-pricing agreements with major pharmaceutical companies could save the U.S. economy $529 billion over the next decade, according to White House estimates.
Meanwhile, the affordability crisis extends beyond insured workers. Recent CDC data showed the U.S. uninsured rate remained at 8.3% in 2025, leaving roughly 28 million Americans without health coverage, while millions more remain underinsured.
The broader cost burden has intensified calls for reform, with Sen. Bernie Sanders (I-Vt.) arguing that despite the U.S. spending more than $15,000 per person on healthcare, tens of millions remain uninsured or underinsured.
Simon Camaj, Mercer's U.S. Health Leader said employers are using a mix of traditional cost-sharing tactics and alternative care strategies to manage another year of elevated health benefit cost growth while attempting to minimize the impact on employees.
Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.
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