Healthcare Costs Are Surging 9.5% This Year, and the Bill Is Landing on Workers’ Doorsteps

America’s corporate medicine cabinet is getting a lot more expensive. Employer healthcare costs are projected to jump about 9.5% this year, the steepest increase in at least 15 years, driven by pricier care, rising prescription drug costs, and expanding services. Executives say the surge is pushing companies toward a tipping point, with many already considering major changes to employee health coverage.

• Mediterranean chain Cava GroupCAVA
  raised employee premiums in 2025 and is exploring self-insurance to regain control of healthcare costs.
• CostcoCOST
  said healthcare expenses grew faster than sales in late 2025, though executives say costs have since normalized.

Benefits inflation: Standard cost-cutting moves like renegotiating vendor contracts or tweaking plan designs might shave 2–3 percentage points off increases, but that still leaves employers far from manageable levels. Aon’s Farheen Dam warned that getting from 9.5% to something “more reasonable” will require more drastic action. With no relief in sight for healthcare costs, workers may face tighter budgets, higher deductibles, and tougher choices between everyday expenses and medical care.