Health Insurance Premiums Poised to Rise Twice as Fast as Inflation in 2026

Sticker Shock Ahead for Workers

Open enrollment season may come with an unwelcome surprise this year. According to a new analysis from consulting firm Mercer, health insurance premiums for employer-sponsored plans are projected to rise between 6% and 7% in 2026—more than double the current rate of inflation. That means employees could pay around $2,400 for single coverage and $8,900 for family coverage next year under preferred provider organization (PPO) plans, the most common type of employer-provided insurance.

More than 60% of working-age Americans—about 164.7 million people—receive health insurance through their employers, according to KFF. While companies typically shoulder the majority of costs, averaging $18,000 per worker in 2026, employees usually pay between 16% and 25% of the total, depending on coverage type.

What’s Driving the Increase

Mercer attributes the spike to several factors: an aging workforce, greater demand for high-cost treatments such as GLP-1 weight-loss drugs, and rising provider wages and medical goods inflation. “We think costs are pretty sticky right now,” said Mercer’s Chief Actuary Sunit Patel, noting that employees may also see higher co-pays and deductibles as companies adjust plan designs.

The Broader Financial Picture

Americans already spend twice as much on health care as citizens in other developed nations, yet outcomes often lag behind. Consolidation among insurers and health systems has also reduced competition, driving costs higher.

With groceries, utilities, and housing prices still elevated, many families face difficult choices. A KFF poll found that 4 in 10 insured adults under 65 worry about affording monthly premiums. As economist Lindsay Owens put it: “You can’t really go without health care, so something else will have to give.”