Insurance
Home›Insurance›Health Insurance›Small businesses absorb rising health premiums as cove…
Small businesses absorb rising health premiums as coverage holds
Gusto analysis found the median premium reached $8,743 per employee in 2026, up 31% from 2022, while about 21% of small firms offer health insurance.
Small businesses have continued offering health insurance even as premiums climbed, according to new Gusto data. The median premium paid by small businesses reached $8,743 per employee in 2026, up 31% from 2022, and the share of small businesses offering coverage stayed around 21%.
Gusto said most owners are effectively absorbing the cost rather than cutting coverage, with only 2.1% planning to drop health insurance. The analysis is based on anonymized payroll and benefits data from more than 500,000 businesses with two to 49 employees, reweighted to better reflect the broader US small business population by industry, size, and geography.
The premium increase was not uniform across all small employers. Businesses with two to five employees paid a median of $9,170 per employee in 2026, about 6% more than firms with 25 to 49 employees, with Gusto pointing to differences in how health insurance is priced.
The findings come from a new Gusto analysis that draws premium figures from a subset of businesses where Gusto acts as an insurance broker. Gusto described itself as a payroll and human resources software company that provides health insurance brokerage for some platform clients.