US Employer Healthcare Costs to Surpass $19,000 per Employee by 2027: Aon

TL/DR –

Aon plc predicts that U.S. employer health care costs will increase by 9.5% in 2027, bringing average costs to over $19,000 per employee. The rise in costs is attributed to higher medical utilization, the increasing prevalence of chronic conditions, a rise in high-cost claims, and significant prescription drug costs, particularly from the growing use of specialty medications and GLP-1 treatments. This projection marks the fourth consecutive year of significant health care cost increases, a trend that represents one of the most sustained periods of health care inflation employers have faced in decades.

US employer health care costs are expected to increase by 9.5% in 2027, taking the average cost per employee above $19,000, predicted by Aon plc.

This estimation marks the fourth year of consecutive healthcare cost increases nearing double digits. Aon indicates this continues a period of significant health care inflation employers have faced for decades.

Why are Health Care Costs Rising?

Aon identifies factors contributing to health care spending increases as heightened medical utilization, a growing prevalence of chronic conditions, and a rise in high-cost claims. The use of expensive GLP-1 treatments and prescription drugs for conditions like cardiovascular disease, sleep apnea, and chronic kidney disease are also significant contributing factors.

Employers already feel the pinch with an 8.8% rise in health care costs in 2026, a significant increase from 3.7% in 2022. Currently, employers absorb approximately 82% of total health plan expenses. Additionally, average employee health care expenses are expected to reach around $5,300 in 2026, inclusive of payroll contributions and out-of-pocket costs.

Employers Face Mounting Costs

The increased use of GLP-1 treatments has notably impacted large businesses’ expenses.
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