If you’re one of the approximately 165 million Americans who get their health coverage through work, rather than the government, you may be wondering: Will my plan be next, now that Affordable Care Act (ACA, also known as Obamacare) health insurance premiums are going up next year?
Experts say there won’t be a one-time, across-the-board increase, but increases are likely for many people with employer-sponsored plans. And even if your monthly premium stays the same, you may end up paying more due to increased deductibles or co-pays.
“Health insurance premiums went up last year. This year they went up again. And next year they will go up again,” said Dr. Kevin Schulman, a professor of medicine at Stanford University School of Medicine who researches corporate-sponsored health insurance.
How much could your plan go up?
Unlike ACA plans, in which insurers publicly submit proposed rate increases to state and federal regulators, companies typically negotiate plans with insurers privately, according to Gary Claxton, director of the Health Care Markets Program at KFF, a health policy research group. That means your premium increase may not be evident until the open enrollment period.
Still, recent employer surveys shed some light on what companies expect to pay next year, although the increase may does not have a full impact on employees.
(The Trump Administration considers not paying federal employees for the days that the closure lasts)
A September report from benefits consulting firm Mercer found that employers say health plan costs could rise nearly 9% on average in 2026 if no steps are taken to control costs. The survey was based on more than 1,700 U.S. employers. Another report from consulting firm Aon projects that employer health costs will rise 9.5% next year, based on data from more than 1,000 U.S. companies. The human resources consultant Segal estimates an approximate increase of 9% for health plans and 11% for medicines filled only by prescription.
Claxton said some employers will decide to pass some of the additional costs onto employees through premiums. The Mercer report, for example, said the average cost of coverage per employee is expected to be 6% to 7%, the biggest increase in more than a decade, a jump that will likely be reflected in workers’ premiums.
“If we see a big 6.5% increase, it’s likely that employees’ contributions, their share of the premium, will increase by the same amount,” said Beth Umland, Mercer’s director of health and benefits research.
However, other companies may keep premiums stable but increase deductibles or co-pays, according to Claxton.
Others, in a competitive labor market, could absorb all of the increased costs.
“Sometimes it is better to assume that expense than to upset employees, especially if it means some of them will leave,” Claxton said. “It’s often more expensive to hire new workers.”
It also depends on the size of the company and whether its employees are healthy enough to take on the financial risk.
“If you have a very young workforce, your premiums will be lower,” Claxton explained. “If you have an older workforce, they will be higher. If you are a business owner with only a few hundred employees, and you have a couple of really sick people, you can see a big increase from year to year, especially if that illness is going to persist.”
(These are the main changes to the new COVID-19 vaccination guidelines)
Schulman noted that some companies may try to control costs by limiting the doctors and hospitals employees can go to, also called “network restriction.”
Still, he said, premium increases have been a growing trend: Health insurance costs as a percentage of median family income have risen from 13% to 25% between 2000 and 2021.
“These are huge increases in premiums of health insurance,” said Schulman.
Why is insurance becoming more expensive?
In the Mercer and Aon reports, employers cited many of the same cost pressures that are driving up ACA premiums, including rising hospital costs and expensive prescription drugs like GLP-1, and the growing number of people seeking medical care, thanks in part to convenient options like telehealth, which make it easier for people to get help.
JoAnn Volk, research professor and co-director of Georgetown University’s Center on Health Insurance Reform, said the increases are largely due to rising health care costs.
Georgetown’s McCourt School of Public Policy last month sent a memo to Democratic senators requesting information about the proposed fee increases in the ACA plans. Volk stated that many of the forces affecting ACA plans, such as rising prices, increased use of services, and inflation, are also affecting employer plans.
People are also spending more. Health care spending increased around 8.2% in 2024 and is expected to grow another 7.1% this year, outpacing spending in the economy as a whole, according to a study published in June in Health Affairs. Health spending could slow slightly in 2026 as fewer people are expected to have health insurance, but costs are likely to continue rising faster than the overall economy.
Some employers could raise premiums next year, while others have already set rates and won’t adjust them, Volk said.
In the next year, they may also consider new employees who previously had coverage through the ACA marketplace or another individual plan.
(Supreme Court skeptical about banning so-called “conversion therapies” for LGBTQ teens)
“Some employers start in one fiscal year, which could be the summer of next year, and are more likely to say, ‘Now we have an idea of who will return to the employer’s plan, so prices could be adjusted to reflect that‘” he explained.
