Health insurance premiums are up, putting pressure on employers and workers

Health premiums are rising this year, and as a result employers may start to shift more costs onto their workers.

The annual premium for an employer-sponsored family health plan is $26,993 this year, on average, up 6% from 2024, according to a report from the Kaiser Family Foundation (KFF). The average annual premium for a single-coverage health plan comes in at $9,325, a 5% YoY uptick, according to KFF’s estimate.

Workers bear about 16% of the premium cost if they’re on single coverage plans, while those enrolled in family coverage plans pay more than one-quarter (26%) of their premium, on average.

What’s driving health premiums higher? Prescription drug prices were the top factor cited by firms with 200 or more workers as driving costs higher.

GLP-1 drugs for weight loss are top-of-mind for some employers when it comes to prescription drug spending, the survey indicates. The share of employers with 5,000 or more employees covering GLP-1s rose to 43% in 2025, compared to 28% last year. And nearly two-thirds of these firms said the drugs had a “significant” impact on their plan’s prescription drug spending.

This aligns with other surveys tracking employer spending on healthcare. The high cost of GLP-1s—with list prices ranging from $1,000 to $1,500 a month—has prompted some employers to limit or even drop coverage.

Other cost drivers that employers said were contributing “a great deal” to higher premiums included chronic disease, higher utilization of services, and hospital prices.

HR’s challenge. Such trends put employers in a difficult position, KFF noted in a discussion regarding the report. Though companies can raise the out-of-pocket amounts workers pay for their healthcare to address these rising premiums, their employees are likely already concerned about such practices.

Nearly half of large employers surveyed by KFF said their employees were highly or moderately concerned about current cost-sharing levels at their organizations. And many workers already incur significant costs from their employer’s medical plan; one-third of those enrolled in a single coverage plan have a deductible of $2,000 or more, for instance.

“Employers have nothing new in their arsenal that can address most of the drivers of their cost increases, and that could well result in an increase in deductibles and other forms of employee cost sharing again, a strategy that neither employers nor employees like but companies resort to in a pinch to hold down premium increases,” Drew Altman, KFF’s president and CEO, said in a statement.

High health insurance premiums can make a serious dent in workers’ earnings over time, particularly if they’re low-income, HR Brew previously reported.

Though it’s rare, some companies do cover the entirety of their workers’ health premiums, NPR recently reported. Zocdoc, a scheduling platform for healthcare providers, offers a zero-premium plan to employees who pay a higher deductible. “It is a growing expense, no doubt,” Zocdoc CEO Oliver Kharraz told the outlet. “But we think that it’s our job to make sure that the company is healthy enough that we can afford to bear it.”