"It found that employers don't expect any relief soon either. They anticipate their healthcare costs to increase by 9.1% in 2026 (before making plan changes), compared to 8.1% in 2025 and 7% in 2024. After making plan changes, these numbers are 8%, 7% and 6%, respectively. The top drivers of these costs are pharmacy costs (specifically specialty drugs and GLP-1s), high-cost claimants and chronic conditions."
""Fewer employers are absorbing rising costs because it's becoming too expensive. They're also avoiding aggressive cost-shifting because it can affect employee health, satisfaction and retention. Instead, employers are looking to bold disruptive changes that control costs and improve health to create a more sustainable path forward," said Tim Stawicki, chief actuary of Health & Benefits at WTW."
"Employers also plan to hold their vendors more accountable, with 46% of companies evaluating vendor performance. In addition, 36% are taking medical plans out to bid, and another 50% are planning or considering doing this. About 41% of businesses are also adopting alternative plan designs, and 46% are planning or considering doing so in the future."
Respondents included 417 employers with over 100 employees; 81% were self-insured and 19% were fully insured. More than half of employers were over budget on healthcare by an average of 4.5 percentage points in 2024. Employers anticipate healthcare cost increases of 7% in 2024, 8.1% in 2025 and 9.1% in 2026 before plan changes, and 6%, 7% and 8% respectively after plan changes. Top cost drivers include pharmacy spending (notably specialty drugs and GLP-1s), high-cost claimants and chronic conditions. Planned responses include broader cost-saving actions, cost shifting, vendor accountability, plan bidding and alternative plan designs.
Read at MedCity News
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