The Fifteen Percent Letter

A buddy of mine runs a landscaping company. Nineteen guys, three trucks on the road before sunrise, a business he built one yard at a time.

Last fall a letter showed up from his insurance broker. Renewal attached. Premiums up seventeen percent. Sign and return by Friday.

He signed it. Of course he did. It was the second week of November, he had crews out every day trying to finish fall cleanups before the weather turned, and the letter looked like every other renewal he’d ever gotten. Higher number, same plan, same carrier, same broker who’d been sending him the same PDF for eight years.

In February he found out a competitor across town with roughly the same size crew had moved to a different plan design, seeded his guys’ HSAs, and was paying about $38,000 a year less than my buddy for coverage his team actually liked better.

Same market. Same year. Same kind of employees. One guy treated the renewal like a utility bill. The other guy treated it like a negotiation.

That letter is about to show up again. For a lot of you it’s already sitting in your inbox. So this Monday, we’re going to make sure you open it like a businessman instead of a bill payer.

Let’s get the bad news on the table so we can move past it.

Across 276 insurers filing for 2027, the median proposed increase on individual market plans is about 15 percent, according to the Peterson KFF Health System Tracker. That’s on top of a 20 percent median increase last year. Small group plans, the kind most of you buy for your teams, are looking at a proposed median of about 14 percent.

If you’re covering employees through a bigger employer plan, the projections aren’t much friendlier. Consulting firms expect employer health costs per worker to climb 8 to 11 percent next year.

And remember where we’re starting from. The average family plan through an employer already ran $26,993 a year in 2025, per KFF’s employer survey. That was before this round.

Here’s the calendar that matters:

You can’t control the 15 percent. You can control what you do with the next eight weeks. That’s the whole game.

Most owners handle health insurance the way they handle the power bill. It shows up, it’s higher than last year, you grumble, you pay it.

But your electric company doesn’t offer you six different ways to structure the bill. Your health insurance does. Every renewal is really three decisions dressed up as one signature:

Sign the renewal as is and you’ve made all three decisions by default. And default is the most expensive way to make any decision in business.

I’m not your broker and I’m not your CPA, so take this to both of them. But I’ve watched enough owners overpay to know where the money hides. Let’s start with you, then your team.

If you buy your own plan or your family’s plan, here’s how to stop guessing.

Premium is only half the cost. The other half is what you’ll actually spend when you use the thing. So for every plan you’re considering, write down three numbers:

Now compare the plans across all three. What you’ll usually find is that the plan with the cheapest premium isn’t cheapest in the ugly year, and the plan with the lowest deductible is wildly overpriced in the quiet year. Pick the plan that wins the year you’re most likely to have and doesn’t wreck you in the year you’re afraid of.

This used to be a spreadsheet chore that ate a whole Saturday. It’s not anymore. Every plan has to publish a Summary of Benefits and Coverage, a standardized PDF that lays out the deductibles, copays, and maximums. I drop those PDFs into Claude or ChatGPT through Galaxy.ai, which gives me all the major AI models under one login, and I ask it to build the three scenario table for me. Twenty minutes, side by side, done. Then I check the numbers against the PDFs myself, because you never sign off on anything a machine added up without looking.

The cheapest plan in your area is often cheap for a reason. The network is narrow. Before you pick anything, look up your family’s doctors, your kids’ pediatrician, and the hospital you’d actually want to end up in. If they’re out of network, that plan isn’t cheap. It’s a trap with a nice monthly number.

If you’re healthy, earning well, and not using much care, a high deductible plan paired with a Health Savings Account is one of the best deals the tax code gives you.

The IRS already set the 2027 HSA limits: $4,500 for self only coverage and $9,000 for family coverage, plus a $1,000 catch up if you’re 55 or older. To qualify, the plan needs a deductible of at least $1,750 for self only or $3,500 for family.

Here’s why I like it for men in our bracket. Money goes in pre tax. It grows without being taxed. It comes out tax free for medical expenses. And unlike most benefits, it doesn’t expire. It’s yours, and it stacks up year after year. Plenty of guys treat it as a quiet second retirement account for medical costs later in life.

The catch is real, though. You need cash on hand to cover the deductible if the ugly year shows up. If a $3,500 surprise bill would hurt, fix your cash reserve before you chase the tax benefit.

If you’re self employed or own the business, how your premiums get paid and deducted depends on your entity structure. Ask your CPA this, word for word: “Am I getting the full deduction on my own health insurance premiums, and is my HSA set up the most tax efficient way for my structure?” Five minute conversation. Could be worth thousands.

This is where the real money moves. And this is where most owners hand the whole thing to their broker and walk away.

Your broker gets paid by the carrier, usually as a percentage of premium. Read that sentence again. When your premium goes up 15 percent, his paycheck goes up 15 percent. I’m not saying he’s crooked. I’m saying his incentives don’t line up with yours unless you make them.

So call him this week and ask for five things, in writing:

If he can’t or won’t get you all five, that tells you something. A good broker welcomes these questions because he wants to keep your business. A lazy one forwards the renewal PDF and calls it service.

Once you’ve got options in hand, here are the moves I see owners make most often.

This is the option most small business owners have never heard of, and it’s growing fast. ICHRA adoption jumped 53 percent in 2026 as group premiums kept climbing.

Here’s the short version. Instead of buying a group plan, you give your employees a set amount of tax free money each month, and they buy their own individual plan.

The upside is a predictable, fixed cost. You pick the number. No more renewal letters dictating your budget. The downside is your people have to shop for their own plans, and there are real rules about how these interact with marketplace subsidies. This is absolutely a conversation to have with a broker who knows HRAs, not one who’s never set one up. But if your premiums are climbing and your team is young and healthy, you owe it to yourself to see the number.

Here’s the step almost every owner skips. Before you pick anything, ask your team three questions. A two minute survey, anonymous if you want.

You’ll learn more from those answers than from any broker deck. You might find out that half your crew is covered on a spouse’s plan and you’re designing around people who aren’t even enrolled.

If costs are going up for your team, the worst thing you can do is let them find out from a smaller paycheck in January. A 15 percent premium jump can eat a raise whole. People notice that, and they remember who told them and who didn’t.

Get in front of it. Something like:

“Health insurance costs are going up across the country again next year, and ours are too. I didn’t just sign the renewal. I shopped it, I looked at different options, and here’s what I picked and why. Here’s what changes for you. If you have questions, my door’s open.”

That’s not an HR announcement. That’s leadership. And it’s a lot cheaper than replacing somebody who quietly decided you don’t care.

“I don’t have time for this in Q4.”

You have time for a two hour project that could save you five figures. You just don’t want to spend it on something this boring. I get it. Do it anyway. Block two hours this week, make the calls, and let your broker do the legwork. That’s what you pay him for.

“My broker’s been with me forever. I trust him.”

Good. Then he won’t mind proving it. Asking for competitive quotes isn’t an insult. It’s the same thing you’d do with any other vendor who costs you this much.

“Changing plans will upset my employees.”

Surprising them will upset your employees. Changing plans with their input, explained clearly, with real reasons, usually goes fine. Most people just want to know you thought about them.

“It’s going up no matter what. Why bother?”

Because there’s a big difference between going up 15 percent and going up 4 percent after you redesign the plan. And because the year you stop asking questions is the year you start paying the lazy tax.

Three things before Friday:

Then sit down with real options in front of you, instead of one PDF and a deadline.

Wednesday we’re talking about the health benefits you already paid for this year and haven’t touched. The clock on those runs out December 31.

Refined. Relentless. Unapologetic.

Marcus