On average, employees contribute $6,850 annually to the cost of family coverage, with employers paying the rest.
“There is a quiet alarm bell going off. With GLP-1s, increases in hospital prices, tariffs and other factors, we expect employer premiums to rise more sharply next year,” KFF President and CEO Drew Altman said. “Employers have nothing new in their arsenal that can address most of the drivers of their cost increases, and that could well result in an increase in deductibles and other forms of employee cost charging again, strategy that neither employers nor employees like but companies resort to in a pinch to hold down premium increases.”
Originally developed for type 2 diabetes, GLP-1 medications are a class of prescription drugs that mimic a natural hormone to help regulate blood sugar and promote weight loss.
The increase in annual premiums is similar to the 7% increase seen in 2023 and 2024, and outpaces the general inflation rate (2.7%) and wage growth (4%).
The average single coverage premium increased 5% in 2025 while the average family premium increased 6%. The average family premium has increased 26% since 2020 and 53% since 2015.
Employers are bracing for higher costs next year, the report states, with insurers requesting double-digit increases in the small-group and individual markets on average, possibly foreshadowing big increases in the large-group markets.
In recent years, employers have continually singled out drug prices as a factor contributing to higher premiums.
KFF is an independent, non-profit organization that provides research, polling and public health information without advocating for specific policies.
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