Michigan small businesses are increasingly concerned about the rising cost of employee health insurance, according to a new survey from the Small Business Association of Michigan.
The May 2026 survey found nearly 8 in 10 small business owners reported double-digit increases in healthcare premiums this year, while more than 75% said rising healthcare costs are limiting their ability to hire additional employees.
SBAM President and CEO Brian Calley said some employers have seen annual increases approaching $2,000 per employee. For a company with 25 workers, he said that could mean an additional $50,000 in yearly healthcare expenses.
The survey also suggests some employers may eventually reconsider offering health insurance coverage altogether. Asked how soon they might consider dropping employee coverage if costs continue rising at current levels, 42% said within one to three years, while another 16% said within four to six years.
Business owners responding to the survey said the higher costs are affecting staffing, pricing, expansion plans and other long-term decisions.
More than 85% of respondents said employee benefit costs are influencing their future growth strategies.
SBAM said it has been urging healthcare industry leaders and policymakers to address rising costs that are increasingly being passed along to smaller employers.
The association received 269 responses to the survey, with 80% of participating businesses employing 50 or fewer workers.
