DENVER–Colorado is projected to see a double digit increase in small group health insurance premiums in 2026, with an average increase of 13.6% statewide. That’s according to rate increase requests made by five major insurers to Colorado’s Division of Insurance (DOI) for approval.
This significant increase is a result of multiple factors, according to Kevin McFatridge, executive director of Colorado Association of Health Plans, including rising costs of hospital care, prescription drugs and provider services, as well as major shifts in policy.
“Colorado’s General Assembly has enacted health benefit mandates and regulatory requirements over the last seven years. While many of these are well-intended, they carry real and cumulative costs that directly impact premium rates,” McFatridge told Complete Colorado.
There are currently around 172,000 Coloradans who rely on small group plans for health insurance. Tim Hebert of Sage Benefit Advisors says such large rate hikes will negatively impact small employers across the state.
“I’d definitely say it’s a negative impact because the rates are going up higher and employers can’t absorb that increase,” Hebert told Complete Colorado. “So a lot of this can be passed on to employees, they’re going to get the same plan they had last year for more money out of their paycheck.”
Legislative changes made in the 2024 legislative session, such as Senate Bill 73, downsized the number of employers who qualify for small group plans.
Colorado’s small group employer plans previously applied to companies with 1-100 employees, but starting in 2026, the plans will only be available to companies with 1-50 employees.
Some areas of the state will be hit harder than others, with the Western Slope seeing premium increases of 14.9%, and Pueblo County being hit a bit harder at 15%.
The individual market will also see a large premium increase, by an average of 28% statewide and up to 38% on the Western Slope.
“I think we’re going to see a lot of people become uninsured,” Hebert concluded.
