Boston Faces $80 Million Health Insurance Spike as FY27 Budget Season Opens

BOSTON — February 26, 2026 — Boston City Council opens FY27 budget season with warning of $80 million health insurance surge. Chief Financial Officer Ashley Groffenberger told the Ways and Means Committee on Thursday that a proposed 22.6 percent rate increase for non-Medicare employee health plans would add $80 million to the city's operating budget — roughly eight times the $10.6 million average annual increase of the prior eight years — driven by a depleted health insurance trust fund, two individual claims totaling $7 million, and surging GLP-1 medication use for weight loss. The city is self-insured and currently in year six of a seven-year Public Employee Committee agreement, meaning any plan design changes require union consent. Two cost-reduction options were presented: implementing utilization management, which would cut the rate to 20.3 percent and save $9.2 million, or adding discontinuation of GLP-1 coverage for weight loss, bringing the rate to 17.3 percent and saving roughly $18 million. Councillor Sharon Durkan, who disclosed her own use of GLP-1 medication, pushed back sharply after the state GIC voted the same morning to eliminate that coverage for 22,000 state employees, calling the drugs "life changing for a lot of people." The city expects revenue growth of only 1.5 to 2.5 percent for FY27, with the mayor's full budget due April 8.