Health insurance costs for small businesses and their employees in Washington State are expected to increase by an average of 11.9% in 2025, according to the Office of the State Insurance Commissioner.
This represents the highest rate of increase for small employers in a decade.
Nearly 220,000 people will be affected by the new rates starting in January. Ten insurance companies were approved to sell group plans to small employers, with the largest increase at Regence Blue Cross Blue Shield of Oregon at 21.9%, affecting about 6,000 people.
“Health insurance premiums have been the No. 1 issue for small businesses for 38 years in a row, and these increases will only make the situation worse,” said Patrick Conner, Washington state director for the National Federation of Independent Business.
Nationally, just over half of small employers offer health insurance to their employees.
“For small businesses, deciding whether to offer health insurance to their employees is a difficult decision. The fact that more than a dozen insurance companies in Washington state offer small employer plans is an encouraging sign.” Washington State Insurance Commissioner Mike Kreidler said.
The average annual premium per employee in the U.S. is $1,368, a 6% increase from 2023, according to the healthcare research nonprofit KFF. The average cost for employees with family insurance is $6,296, an increase of 24% over the past five years.
“High costs are often passed on to customers, driving up prices for goods and services for average Americans. We need action to make this happen,” Sammy Curley, small business advisor for Small Business for America’s Future, said in a press release from Fair Health Prices in Washington. Consumer Health Care Advocacy Coalition.
Employers pay an average of $7,584 for personal health insurance on top of the employee’s share, according to KFF statistics.
Kreidler said his office sent a report to Congress in August with policy options to make health insurance more affordable in Washington.
“We’re hopeful that we can improve the underlying factors that are driving costs up,” Kreidler said.
