Health insurance premiums for families in Massachusetts climbed 38 percent from 2019 to 2025 — considerably outpacing the rest of the country — and will hit $50,000 a year by 2032 at recent growth rates, according to a state report released Tuesday.
At a time when millions of Americans are worried about affordability, the study by the Massachusetts Health Policy Commission found that premiums had risen faster in the state than household income and inflation.
The average family premium for employer-based coverage reached nearly $30,000 last year. The figure, which includes employer and employee contributions, is among the highest in the country, due to the surge in use of pricey antiobesity drugs, the prevalence of more expensive imaging tests, and other factors, the commission said.
Nationally, premiums rose 28 percent from 2019 to 2025, led by gains in Nebraska, Oregon, and New Hampshire, according to the commission. Alaska, New York, and New Jersey had the highest average costs.
For 10 percent of Massachusetts families, health insurance premiums exceeded $41,000 last year, said the researchers.
The commission also found that more than one-fourth of Massachusetts residents reported that they or a family member had an unmet health care need due to costs. Health care costs greatly exceed housing costs in some regions of the state, particularly in Western Massachusetts.
“The status quo is not sustainable,’’ David Seltz, the commission’s executive director, said at the start of a daylong hearing hosted by the panel and featuring health care leaders, insurers, government officials, and patient advocates. “We need to confront the underlying structural challenges driving health care spending.’’
With out-of-pocket spending taken into account, the average cost of health care for a Massachusetts family exceeded $34,000 in 2025 annually, or $2,846 per month.
Alan Sager, a professor of health law, policy, and management at Boston University, said in an interview that he wasn’t surprised by the rising insurance premiums and out-of-pocket costs.
Massachusetts, he said, is dominated by expensive teaching hospitals and has a high concentration of medical specialists but a shortage of primary care doctors.
“Our health care costs have long been the highest or nearly the highest in the country, and, therefore, in the world,’’ Sager said. “To cover high costs, you have to generate high revenue.’’
Seltz noted that a “health care affordability’’ panel appointed by Governor Maura Healey released 12 recommendations in August targeting what he characterized as the biggest contributors of rising health care costs.
The proposed remedies include limiting extra fees imposed on patients who seek treatment out of network, discouraging costly unnecessary diagnostic tests such as MRIs for lower back pain, and encouraging hospital systems to provide cheaper, less intensive care to patients in their homes.
But Mass General Brigham, the biggest health care system and employer in the state, recently confirmed it would cut in half the number of patients treated at one time in its acclaimed 9-year-old Home Hospital program because it has been losing an average of $30 million a year.
In August 2024, the program had a capacity to treat 70 patients, making it the largest home hospital program in the country, according to a news release at the time. After impending cuts, it will treat no more than 30 patients simultaneously.
Seltz also noted that the state Senate and House passed rival bills this summer to raise the share of spending that goes to primary care from 6.6 percent to 15 percent — without increasing overall expenses.
Prioritizing primary care is widely considered the most prudent thing a health system can do to improve outcomes and lower expenses; having a primary care provider is linked to sharply lower costs for adults with chronic disease, fewer hospitalizations, and less frequent emergency department visits.
The Senate bill would require that change to take place by 2030 while the House bill is more gradual, pushing the deadline to 2036. Lawmakers hope to reconcile the bills by the end of the year, but insurers have raised concerns that both versions would increase overall expenses and lead to higher premiums.
Lora Pellegrini, chief executive of the Massachusetts Association of Health Plans, which represents more than a dozen insurers, suggested that the focus on rising insurance premiums in a commission news release about the annual cost trends report was misplaced.
“Massachusetts health insurance premiums are a direct reflection of health care costs,’’ she said in a statement.
More than 40 state reports, including those produced by the commission, she said, have repeatedly identified a variety of causes for rising costs. They include rising spending on prescription drugs such as GLP-1s for weight loss and diabetes, costlier inpatient and outpatient care, and overcharging by physicians who seek reimbursements from insurers by using the highest billing codes.
As a result, she said, Massachusetts has exceeded the 3.6 percent annual growth benchmark set by the state to try to rein in medical expenditures eight of the past 12 years, including each of the past four.
“Health plans cannot solve the health care affordability challenge alone,’’ Pellegrini said. She said state officials, health care providers, insurers, and consumer advocates must “address the root causes’’ of rising costs.
Niyum Gandhi, Mass General Brigham’s chief financial officer, told the commission that rising health care costs partly reflect the advent of expensive cell and gene therapies to treat diseases such as blood cancers and genetic disorders. He also said inflation has raised “labor costs in one of the most expensive housing markets in the country.’’
Unionized nurses at Brigham and Women’s Hospital who are threatening to go on strike on Thursday have repeatedly cited housing costs as a reason they want across-the-board wage increases.
The commission released its cost trends report at a time of great uncertainty for health care in the US and Massachusetts.
Hospitals have been girding for deep losses next year under President Trump’s One Big Beautiful Bill Act. That law will cut benefits to many Medicaid recipients and could prompt patients who have lost federal health insurance to go to costly emergency rooms for routine care.
With the transfer of control of Congress to Democrats in January as a result of last week’s midterm elections, however, lawmakers hope to reverse the cuts in Medicaid and Obamacare subsidies — although they would have to contend with a likely Trump veto.