As workers and employers across the nation struggle with rising healthcare costs, the Sidwell community has seen tuition increases to help staff cope with the dilemma. On Jan. 23, the Sidwell Friends School Board of Trustees approved an aggregate tuition increase of 3.9%, citing rising healthcare costs and the decision to absorb the majority of employee’s premiums, according to a letter sent to parents. Tuition for the 2026-2027 school year will be $62,330 for grades 9-12, up from $59,920.
Chief Communications Officer Bill Burger said in an email that Sidwell employees can choose among six insurance plans from two insurers — four from CIGNA and two from Kaiser Permanente — each with four coverage options. This year, CIGNA increased premiums by 20% and Kaiser by 6%, though Sidwell absorbed a majority of the CIGNA increase. As a result, most employees covered by CIGNA will experience an 8% increase rather than the full 20%.
Furthermore, because tuition accounts for more than 85% of the school’s operating revenue, increases in employee benefits and insurance costs are often reflected in tuition. Other independent schools in Sidwell’s purchasing consortium, such as Stone Ridge, Georgetown Day School and Landon, are similarly facing the steep increases from CIGNA.
A September 2025 study by Mercer, a benefits consultant, found that employees nationwide could see paycheck deductions surge by an average of 6% to 7% because of rising insurance costs, and employers will be paying, on average, almost 9% more per employee for the same level of benefit. The survey of more than 1,700 organizations and workplaces found that employers are facing the biggest price increase in 15 years.
U.S. healthcare spending increased by 7.2% in 2024, reaching $5.3 trillion, or $15,474 per person, well above the average growth rate of the 2010s (4.2%), according to the Centers for Medicare and Medicaid Services. A 2026 study by the West Health-Gallup Center on Healthcare in America found that one-third of Americans cut back on other expenses to pay for rising healthcare premiums. Furthermore, 92% of enrollees covered under Affordable Care Act (ACA) plans — 22 million Americans — saw their premiums rise after Congress refused to extend certain enhanced health care subsidies, according to CNBC.
“When people cannot afford healthcare, they are more likely to put off necessary preventative care, and more likely to need expensive emergency treatments as a result,” Upper School Economics Teacher Meghan Mulhern said. “This is terrible from a social perspective, as it means more folks suffer traumatic medical experiences or worse, and from an economic perspective, as this increases the average costs of healthcare for everyone.”
According to NPR, not all reasons for the steady increase in healthcare are negative. More people are seeking non-urgent healthcare post-pandemic, an action which drives surging demand and prices. Additionally, pharmaceutical companies have made significant advances in effective cancer treatments and weight-loss drugs, enabling them to raise prices.
However, the healthcare market has become increasingly monopolized over the past ten years, according to NPR, allowing insurers and healthcare systems to raise prices with less competitive pressure.
“What’s missing in health care is: it’s not a traditional free market. You don’t have those competitive forces,” Sunit Patel, Mercer’s chief actuary for health and benefits in the United States, told NPR.
With ACA premiums guaranteed to increase during the next open enrollment period, policy experts are warning that prices won’t get any lower. The John Hopkins Bloomberg School of Medicine explained in a November study that as more young, healthy people are priced out of plans and drop out, a “death spiral” will be created, meaning insurance companies will be forced to increase premiums as plans become more concentrated with older, sicker people.
“It is important to understand some of the fundamentals of health economics so that we can better address these glaring social and economic issues in our society,” Mulhern added.
If healthcare costs continue to rise at current rates, independent schools like Sidwell may face difficult decisions about tuition and employee benefits in the coming years.
