Health insurance premiums for Michigan small businesses will rise an average of 9.6% in 2027 under rate increases approved by state regulators.

The Michigan Department of Insurance and Financial Services (DIFS) approved the changes for small-group plans, which generally cover businesses and organizations with fewer than 51 employees.

The new rates apply to the 2027 plan year and affect a market with 403,722 current enrollees statewide, according to the state's approved rate report.

For Troy's small professional offices, medical practices and independent shops, the increases could add to operating costs, depending on their insurance coverage and renewal arrangements.

Which insurers have the largest increases?

Not all insurers received the same rate increases.

UnitedHealthcare Insurance Co. received the largest approved average small-group increase at 14.8%, covering 6,612 current enrollees. UnitedHealthcare Community Plan followed at 14.5%, with 756 enrollees.

Alliance Health and Life Insurance Co., Health Alliance Plan and Priority Health each received approval for 11.6% increases.

Blue Care Network of Michigan and Priority Health Insurance Co. were approved for 10.7% increases.

Blue Cross Blue Shield of Michigan received the smallest approved average increase at 7%.

Blue Cross has 133,192 current enrollees in the small-group market, while Blue Care Network has 133,899. Together, those two insurers account for 267,091 enrollees, according to DIFS.

Those figures represent statewide enrollment, not the number of affected people in Troy.

What's driving the higher costs?

Insurers have cited rising medical and prescription drug costs, increased use of health services and changes in the health risks of their enrolled populations as reasons for requesting higher rates.

Dominick Pallone, executive director of the Michigan Association of Health Plans, said employers and consumers are facing higher costs from prescription drugs and medical claims, according to the Detroit News.

Blue Cross also pointed to rising medical and pharmacy expenses.

The Detroit Free Press reported that insurers anticipate approximately 10% growth in medical and prescription drug costs for 2027.

The approved premium increases reflect insurers' statewide projections and may not correspond directly to the costs experienced by any particular business.

How 2027 compares with earlier increases

The 9.6% average small-group increase for 2027 is lower than the 11.1% average approved for 2026, according to the Free Press.

The state's individual health insurance market faces a larger increase next year.

DIFS approved an average 14.2% rate increase for individual-market plans, which have 400,322 current enrollees statewide.

Combined, the two markets account for more than 804,000 current enrollees, though they serve different groups of consumers.

Individual-market plans are generally purchased directly by consumers rather than through small employers.

What employees will actually pay

A 9.6% statewide average does not mean every employee or business will see an identical increase.

The amount depends on the insurer, specific plan, age, geographic area and tobacco status, according to DIFS.

Employees' costs will also depend on how much of the premium their employer agrees to pay.

For example, a business could absorb some of the premium increase, pass more of the cost to employees or review different coverage options at renewal.

Those decisions depend on the employer's circumstances and are not determined by the statewide average alone.

State completes rate review

DIFS approved all 18 health insurance rate filings for 2027 after issuing 944 objections during its review process.

The department reported no filing denials and said it processed the submissions in an average of 110 days.

The approved rates are listed by insurer in the DIFS report, which also explains why individual premium changes may differ from the published averages.

Businesses reviewing their coverage can use those figures to understand the statewide market while checking the actual renewal terms provided by their insurers.

DIFS offers insurance assistance through its consumer hotline at 877-999-6442.