U.S. employer health care costs are projected to rise by 9.5 percent in 2027, according to a risk analysis released by insurance broker Aon this week. The firm noted that the increase represents a fourth consecutive year of near-double-digit percentage growth in medical spending.
The projection follows a multi-year trend of rising health care expenses for organizations. Aon identified several factors contributing to the upward trend, including the prevalence of chronic diseases, increased medical utilization, and growth in drug spending.
According to Aon, the second-largest global insurance broker, the projected 9.5 percent increase would result in an average added cost of $19,000 per employee. While the analysis found that costs will rise across all industries, the highest spikes are expected in the public sector, technology and communication, and finance and insurance.
Aon reports that these costs influence broader organizational decisions beyond simple budgeting, impacting benefits strategy and workforce planning. For employees, this may manifest as a change in how affordable their benefits remain, as leaders face pressure to maintain coverage while managing financial priorities. Aon noted that many employers are likely to implement cost-saving programs or changes to benefits packages to mitigate these rising expenses, which could alter what a worker sees in their plan options or out-of-pocket obligations.
The knock-on effects include potential shifts in how companies invest in attracting and retaining talent. Mike Pasterick, Aon’s North America Health Solutions Leader, stated that the sustained level of increases forces leaders to balance benefit affordability with broader financial planning. What happens next depends on individual company responses; Aon indicates that while the status quo suggests a 9.5 percent rise, employers will likely introduce mitigation strategies throughout 2027 to lower the final impact on their budgets.