The Healthcare Coverage Risk Is Rising — And Savvy Hospitality Employers Can Use It to Attract Talent

There’s a shift happening in the American labor market that’s easy to miss if you’re only watching wage data or job reports. It’s about healthcare — and the growing uncertainty around it.

Healthcare coverage in the U.S. is becoming less stable. Costs are rising sharply, eligibility is tightening, and millions of Americans may soon find themselves without coverage or struggling to afford what they have. For many workers, this isn’t an abstract issue. It’s shaping the choices they make about where to work, how long to stay, and who they trust as an employer.

The numbers tell the story. According to the Congressional Budget Office, new federal budget and health provisions could cause as many as 10 million more Americans to lose insurance over the next few years. Analyses of recent legislation, including the “One Big Beautiful Bill Act,” suggest even higher numbers — up to 10.9 million people at risk of losing coverage if all proposed changes take effect.

In its 2025 Health Tracking Poll, the Kaiser Family Foundation (KFF) found that four million Americans are currently projected to lose coverage, and nearly 40% of insured adults under 65 say they worry about affording their monthly premiums. Employers are feeling that pressure too: healthcare costs are expected to rise by nearly 8% this year, one of the steepest increases in over a decade.

To manage costs, nearly 60% of employers plan to make benefit design changes in 2026, often by raising deductibles or shifting more cost to employees. Those measures may help the bottom line, but they also increase employee anxiety about access and affordability.

Meanwhile, recent federal policy changes are tightening Medicaid eligibility and adding work requirements that could reduce participation. The reorganization of the Department of Health and Human Services this year, which consolidated several public health agencies under new leadership, has also shifted priorities away from expanding coverage and toward cost containment. These moves collectively point to a federal posture that places more responsibility for coverage back onto individuals and employers.

For workers, the result is growing uncertainty — and for employers, it’s a new dynamic in the talent market. When people feel exposed or unprotected, they gravitate toward employers who can offer stability.

This is especially true in hospitality, where the workforce is often a mix of hourly, part-time, and seasonal employees who may have limited access to benefits. Turnover remains a chronic challenge, and many workers change jobs for relatively small pay increases. In that environment, stability — especially in something as personal as healthcare — becomes a powerful differentiator.

Some employers in the industry are responding by guaranteeing baseline health coverage, even for part-time or transitional employees. Others are offering “bridge” coverage for new hires so they don’t lose benefits between jobs. A few are providing health stipends or premium subsidies to offset costs, while others are focusing on education and access — offering telehealth options, clear benefit communication, or even onsite health clinics.

These approaches share one thing in common: they make employees feel seen and supported. They tell candidates, you’re safe here. That message carries weight in a time when many workers feel disposable.Offering stronger health benefits isn’t just good ethics — it’s good business. Employees who feel secure are more loyal. They’re less likely to jump for a small raise elsewhere. They show up more consistently and speak more positively about their employer. And in hospitality, where turnover can exceed 70% annually in some positions, even small improvements in retention translate into meaningful financial results.

Of course, using healthcare as a recruitment and retention tool must be done responsibly. Employers need to be transparent about what’s offered and what isn’t. Promises should be sustainable, legally compliant, and equitable across roles. This isn’t about fear or competition — it’s about leadership.Healthcare stability is becoming a scarce commodity in the American workplace. While some employers will wait for these changes to hit their recruiting pipelines, others will act now. Those who do will not only attract talent more effectively, they’ll build the kind of loyalty and trust that money alone can’t buy.