Health Insurance Costs Are Jumping in 2027. Open Enrollment Is Where You Get a Say.

Employer health costs are set to rise 8.2% next year, the biggest jump since 2003, and marketplace premiums a median 15%. Here is what is actually changing, and why a couple of hours in October decides what you pay all year.

September 28, 2026 · 6 min read

Person at a laptop reading a health insurance website while holding a cup of coffee

One of the most expensive pieces of mail you will get this year is about to land, and it will look like junk. Open enrollment paperwork for 2027 is arriving now, and the increases behind it are the steepest in two decades. Here is the useful part: this is one of the few big bills where you actually get a vote.

8.2% is the number to know

If your insurance comes through work, start here. Mercer surveyed more than 1,800 employers and projects that the cost of covering each employee will rise 8.2% in 2027. That is the largest jump since 2003, and it is up from 6.7% this year. Before employers do anything to soften it, the underlying increase is 11%.

Beth Umland, who directs health research at Marsh, put it about as plainly as a researcher can: “This year it was almost hard to look — and yes, it was as bad as we feared, if not worse.” Roughly two thirds of employers with 500 or more employees expect to raise the share of the premium their employees pay. So what lands in your paycheck deduction may not match the 8.2% headline at all, and that is the number worth hunting down in your packet.

If you buy your own plan, the increase is bigger

On the Affordable Care Act marketplace, where you shop for coverage yourself instead of getting it through an employer, 276 insurers across all 50 states and DC filed a median premium increase of 15% for 2027. Sixty three percent asked for between 10% and 25%. It is the second double digit year in a row.

Where you live matters enormously. Arizona is looking at around 29%, while Vermont, Iowa and Utah come in under 7%. Part of the increase is medical costs climbing about 10%, and part is the expiration of the enhanced premium tax credits, the larger subsidies that ran through 2025, worth 4 to 7.7 percentage points on their own. One example from the Peterson-KFF analysis: a 40 year old in Indianapolis earning $65,000 paid $316 a month in 2025, $477 this year, and is projected to pay $546 in 2027. That is $158 more a month, a 41% climb in two years. Enrollment opens November 1 in most states.

On Medicare? Watch your mailbox this week

Medicare plans have to mail their Annual Notice of Change, the letter spelling out exactly what is different about your plan next year, by September 30. That is this Wednesday. Enrollment runs October 15 through December 7, and whatever you pick takes effect January 1.

The premium news is gentler here. Part B, which covers doctor visits and outpatient care, is projected at $209.50 a month, up $6.60 from $202.90, with the deductible rising $9 to $292. That is about 3.5%, a relief after the nearly 10% spike in 2026. Drug coverage is where it tightens. The base Part D premium rises 6% to $41.33, the maximum deductible goes to $700 from $615, and the annual cap on what you pay for prescriptions rises to $2,400 from $2,100. A temporary federal program holding stand alone drug premiums down ends after this year, and the number of those plans has already fallen to 360 from 464 in 2025. If yours vanishes or moves your medication to a pricier tier, that letter is how you find out.

Premium is the wrong number to shop on

This is the mistake I see most often. The premium is just the subscription fee. What you actually spend is the premium plus the deductible plus everything you pay before the plan’s annual limit kicks in. A plan $60 cheaper a month with a $7,000 deductible loses to a pricier one the moment you take a regular prescription.

Two things worth checking. If your household earns below 250% of the federal poverty level, silver marketplace plans carry cost sharing reductions that quietly lower your deductible and copays, which often beats a cheaper bronze plan. And if you have a health savings account, the 2027 limits are $4,500 for an individual and $9,000 for a family. Contributing lowers your taxable income, and it can keep marketplace income under the subsidy cliff at $63,840 for one person or $132,000 for a family of four.

Here’s what I’d tell a friend

Do not let this one auto renew. Auto renewal is the default, and it is quietly the most expensive habit in health insurance, because networks and drug lists change every year and nobody announces it. Block off forty five minutes, pull up what you actually spent on care this year, and price two plans against it: the one you have and one alternative. That is the whole exercise.

What you can do this week

Open the envelope. If you are on Medicare, your Annual Notice of Change arrives by September 30. Read three things: the premium, your prescriptions’ tier, and whether the plan exists next year.
Find your real paycheck number. In your work enrollment packet, look for the employee contribution per pay period, not the total plan cost, then compare it against what you pay now.
Add up what care actually cost you this year. Premiums, copays, prescriptions, the deductible you did or did not hit. That total is the only honest way to rank plans.
Confirm your doctors and medications are still covered. Networks and formularies, meaning the list of drugs a plan pays for, reset in January. Five minutes on the plan’s lookup tool is the cheapest thing on this list.
If you are on the marketplace, put November 1 in your calendar. Increases vary wildly by state and plan, switching costs nothing, and auto assignment will not shop for you.

Open enrollment is a couple of hours of unglamorous paperwork set against a bill you pay all year long. Of all the prices moving right now, this is the one where a decision in October still changes what you pay in March.

Sources

Disclaimer: This blog may include AI-generated content derived from web crawling, and it features quotes from original cited inline or public sources. The information presented is for general informational purposes only and may not reflect the most current data or information available. While we strive for accuracy, we encourage readers to verify the information from original sources or reach out to a certified financial adviser for important financial decisions.