Costs for employer-sponsored health insurance surged from 2023 to 2024, rising faster than inflation, according to a new analysis.
The report was conducted by researchers from the State Health Access Data Assistance Center (SHADAC) at the University of Minnesota. They examined trends in employer-sponsored insurance both nationally and at the state level by comparing 2024 data to 2023.
The researchers found that annual premiums for family coverage offered through employers increased by more than $600 to $24,540 in 2024, a 3% increase from 2023. This is about the cost of a new car, such as a 2025 Toyota Corolla, according to the report. Premiums for individuals rose $300 to $8,486, a 4% increase from 2023.
Employers in several states experienced premium hikes that exceeded the national average, with Delaware seeing the steepest increase. Family premiums there jumped more than 26% — over $5,800 in a single year — while Alabama and Rhode Island also recorded notably large year-over-year increases.
Deductibles, meanwhile, rose an average 8% from 2023 to 2024 for both individual and family coverage, the report found. The average annual deductible for family coverage exceeded $4,000 for the first time in 2024 due to a $330 increase.
More than half of private sector workers with employer-sponsored insurance are enrolled in high-deductible health plans. These provide lower monthly premiums but often lead to higher out-of-pocket costs. In 22 states, enrollment in high deductible plans surpasses 60%.
Researchers found that employee contributions to employer-sponsored insurance remained largely stable nationwide, with workers continuing to pay about one-fifth of the cost for individual coverage and just under 30% for family coverage from 2023 to 2024.
Currently, more than half of Americans receive coverage through their employer, and healthcare costs are becoming a major concern for both consumers and employers.
“Employer-sponsored insurance remains the backbone of health coverage in the United States, but it is becoming increasingly unaffordable for employers and their employees,” said Elizabeth Lukanen, director at SHADAC, in a statement. “As policymakers look for solutions to curb the growing healthcare affordability crisis, addressing the decades-long trend of increasing costs in employer-sponsored insurance must be part of the conversation.”
An executive at the Robert Wood Johnson Foundation, which supported the analysis, echoed this.
“Employer-provided health coverage is not immune from the healthcare affordability crisis that is tightening its grip throughout America,” said Katherine Hempstead, senior policy adviser at the Robert Wood Johnson Foundation. “The trend of moving to high-deductible plans to shield companies and individuals from large monthly premium increases is understandable, but it means greater financial risk down the road in the event of a medical emergency. It’s a gamble no one should have to take.”
Photo: Ta Nu, Getty Images
