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Health Spending Drove Insurance Premium Hikes

A new Yale study found that rising medical costs accounted for the vast majority of premium growth since 2011.

Updated on Sept. 26, 2026 in Insurance

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A Yale University study reports that rising medical care costs were responsible for 91% of the increase in private insurance premiums since 2011. AI Illustration. Upload story photo >

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Private health insurance premiums grew by 78% between 2011 and 2024, rising from a mean of $4,008 to $7,151 per person. Researchers attributed 91% of this growth to increasing health care spending, rather than insurer markups.

Why it matters

The findings clarify that medical cost inflation is the primary driver behind the rising financial burden on U.S. households. This trend persists even as insurer markups have declined from 19% to 15% over the same period.

Average private health insurance premiums surged by $3,143 per person between 2011 and 2024, while health spending increased by $2,844 over the same timeframe. Currently, 48% of individuals purchasing insurance directly report struggling to afford these costs.

The players

Yale University

This private Ivy League research university conducted the longitudinal analysis of national health insurance data.

JAMA Health Forum

This is a peer-reviewed medical journal that serves as a platform for research regarding health policy and clinical care.

Center for Consumer Information and Insurance Oversight

This federal agency is responsible for implementing the provisions of the Affordable Care Act related to private health insurance markets.

The details

Yale University researchers utilized data from the Center for Consumer Information and Insurance Oversight to track insurance costs nationwide. While premiums climbed significantly, the study noted that insurer markups actually shrank from 19% to 15% during the 13-year period.

Timeline

  1. The study analyzed premium data spanning from 2011 to 2024.

  2. Researchers released a digital tool on hospital markets in March 2026.

  3. The full study was published in JAMA Health Forum in September 2026.

Market Dynamics

This analysis updates our understanding of the medical cost landscape relative to the Affordable Care Act's Medical Loss Ratio requirements. It marks a departure from theories attributing premium spikes primarily to insurer profitability, pointing instead to systemic health care spending.

With 54% of U.S. adults relying on employer-sponsored plans, workers should anticipate continued pressure on take-home pay as employers pass on rising insurance costs. Those purchasing individual plans face increasingly difficult budget trade-offs as premium growth continues to outpace many income categories.

The takeaway

The data confirms that medical inflation, rather than insurer margins, remains the dominant force behind increasing coverage costs. Consumers may need to reassess their household budgets as healthcare premiums continue to command a larger share of disposable income.

Further reading

For more on market trends, visit the Insurance section.

Source note: This article includes information reported by Progressive-charlestown.

Live Poll

Do you believe rising health care costs are the primary driver of your insurance premium increases?