Employers brace for more health cost spikes in 2027

Healthcare spending isn’t just skyrocketing for U.S. companies. It’s also getting more difficult to predict, complicating efforts to keep cost growth in hand, according to new research (Source: “Employers face ‘existential reckoning’ as health costs surge,” Healthcare Dive, Aug. 26).
 
Employers are projecting a median 9.2% increase in health costs in 2027, as hospital prices rise, drugs get more expensive and workers and their families simply get sicker, the Business Group on Health, a nonprofit that represents employers on health benefits issues, found in its latest survey.
 
Health cost growth is expected to dip to around 8% after plan benefit changes — still an uncommonly sharp year-over-year spike, if predictions bear out. But employers have underestimated actual medical spend for the past three years.
 
And each subsequent “miss” has been bigger than the one before it, according to experts with the BGH. That means the swell of healthcare costs coming for employers in 2027 could be even more dramatic than feared.