Adam Hardy
Sep 12, 2023
Health insurance through your workplace could be much more expensive next year.
Health insurance through your workplace could be much more expensive next year.
Costs for employer-sponsored health plans in 2024 are expected to jump over 6%, according to new data from consulting firms Mercer and Willis Towers Watson (abbreviated WTW). As the Wall Street Journal first reported, that would amount to the largest price increase for employer health plans in about a decade.
Mercer’s survey, released Thursday, found that health plan costs could jump by 6.6% next year, assuming employers made no cost-cutting changes to their current plans. And even if they do take steps to cut costs, the increase is expected to be 5.4% on average. Similarly, in preliminary survey results shared with Money, WTW found that health insurance costs are expected to rise between 6% and 6.4%.
According to Mercer, typical annual price increases have hovered between 3% and 4% for more than a decade, making next year's estimated hikes particularly steep.
Inflation is finally catching up to health insurance
As workers head into open enrollment season to sign up for 2024 health plans, they may be in for some sticker shock.
Perhaps surprisingly, private health insurance is one area where inflation has largely yet to reach. In fact, the latest inflation reading from the Labor Department shows health insurance costs in a notable period of deflation — meaning that prices are going down. For the year ending in July, overall health insurance costs fell nearly 30%, even as the cost of prescription drugs and other medical supplies jumped.