Increases in the cost of health insurance are presenting a bigger problem for employers, especially small firms that need to weigh employees’ benefits and operating costs. The latest healthcare data from research organization KFF in the US shows that the cost of employer health insurance benefits rose again in 2026, thus adding to the burden of workers and firms.
The workers’ share of family health insurance premiums paid increased by $621 from the year 2025 to an average of $7,471 in 2026, according to the 2026 KFF employer health benefits survey. However, workers from small firms bore even more of the burden, paying an average of $9,687 per annum, whereas those from big companies only paid an average of $6,840.
It clearly demonstrates the struggles that smaller employers have with regard to coverage because large corporations can leverage their number of employees to secure better deals with insurance companies, whereas small companies cannot afford premium increases.
Higher contributions affect employees negatively as they lower their net earnings and may lead to unaffordable insurance plans. Employees may be forced to buy plans with high deductibles and co-payment levels, delaying their visits and treatment. Such decisions may have adverse effects in the future, as individuals may fail to seek preventive measures or will visit hospitals only when their medical conditions are very advanced.
The employers have tough decisions to make. Full absorption of the increased costs may adversely affect their bottom line, especially if the sector experiences low margins. Forwarding the cost burden to their employees may affect their recruitment and retention efforts as the competitors may have better benefit packages. Employers may find themselves forced to review their plans, negotiate prices and even embark on preventive medicine programs and health initiatives to tackle risk factors.
Cost-cutting should however not be at the expense of accessing medical services. The employers and insurers should be able to tell if the cost-saving proposals cut on waste or shift the financial burden on patients.
The problem also has consequences for healthcare providers and policy makers. As affordability takes on greater importance, there will be increased pressure on transparency, efficiency and patient protection from unreasonable charges.
The current numbers highlight an even larger point: the cost of healthcare is not just a matter of concern for insurance firms. It has a bearing on family budgets, competitive advantage and employee health. Successful approaches would need to control unnecessary spending but ensure access to essential care.
