Employer-sponsored health coverage for working-age adults has slid from 67% in 1998 to roughly 60% today, according to a new investigation from STAT News, and small business owners are telling reporters the same thing over and over: the plans they can still find are simply unaffordable.
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What happened
STAT’s “Out of Pocket, Out of Reach” series, published July 7, 2026, spoke with more than 50 people — small business owners, employees, benefits leaders, brokers, and insurance executives — and found employer-based health insurance “crumbling” under the weight of rising premiums. The reporting points to high prices for hospitals, doctors, and prescription drugs, plus more intensive care overall, as the drivers eating into both business bottom lines and employee paychecks.1 The series features Rachel Bernier-Green, founder of Thryvo Financial Advisory in Chicago, as one of the small business owners navigating the shrinking set of realistic options.
Nearly half of working-age adults reported difficulty affording healthcare in 2025, and the businesses STAT spoke with described most, if not all, of their remaining insurance options as unaffordable — particularly plans that still carry high out-of-pocket costs on top of the premium. The trend lines up with earlier reporting on the separate risk facing small business owners who rely on ACA marketplace plans, where expiring enhanced subsidies are set to push premiums even higher for many self-employed and small-business households.2
Why it matters
Health insurance is often one of the largest discretionary line items on a small business’s books, and it’s usually the first benefit owners cut when margins tighten. When that decision gets made reactively — in response to a renewal notice with a big number on it — it tends to happen without a clear picture of what it actually costs the business to lose the benefit: recruiting friction, retention risk, and lost productivity that don’t show up on a P&L until months later.
What this means for small business owners
If you’re staring down a renewal, the first question isn’t “can we afford insurance” — it’s “do we actually know what we’re spending on total compensation, including benefits, right now.” Owners who track labor costs at the department or per-employee level can model the tradeoffs (higher deductible plan vs. dropping coverage vs. a stipend-based alternative) with real numbers instead of gut instinct. That’s a bookkeeping and reporting problem before it’s an insurance-shopping problem, and it’s exactly the kind of decision that benefits from clean, current books rather than a spreadsheet nobody’s touched since last renewal season.
“Rising premiums — driven by high prices for hospitals, doctors, and prescription drugs and more intensive care — are eating into bottom lines and paychecks,” STAT reports in its July 7, 2026 investigation.
The bottom line
The share of small businesses offering health coverage isn’t going to stop declining on its own, and the ACA subsidy cliff coming for marketplace plans will only add pressure. Owners who go into their next renewal with accurate, up-to-date books — not last year’s guesses — will be the ones able to actually compare options instead of just picking the least-bad one under deadline pressure.
