It’s
no
secret
that
employers
are
struggling
when
it
comes
to
healthcare
costs.
A
new
survey
from
Willis
Towers
Watson
revealed
that
more
than
half
of
employers
were
over
budget
by
an
average
of
4.5
percentage
points
in
2024.
The
survey,
released
Monday,
received
responses
from
417
employers
with
over
100
employees.
About
81%
were
self-insured
and
19%
were
fully-insured.
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.
When
asked
how
they
plan
to
manage
costs
in
the
next
three
years,
59%
of
employers
said
they
are
looking
to
implement
“broader
cost-saving
actions,”
47%
will
increase
cost
shifting
onto
employees,
and
32%
will
absorb
costs.
When
looking
at
the
last
three
years,
the
percentage
of
employers
that
adopted
these
strategies
was
46%,
44%
and
50%,
respectively.
“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.
These
include
using
networks
that
limit
access
to
certain
providers,
offering
more
transparency,
and
providing
more
care
navigation.
Additionally,
employers
are
increasingly
dissatisfied
with
their
pharmacy
benefit
manager:
75%
have
or
will
take
their
PBM
out
to
bid.
About
49%
are
using
transparent
contract
structures
and
58%
have
conducted
audits
on
their
pharmacy
benefits.
When
it
comes
to
managing
GLP-1
costs,
employers’
strategies
include
requiring
participation
in
a
lifestyle
management
program,
implementing
a
30-day
fill
limit
and
higher
cost
sharing.
Moreover,
employers
are
becoming
more
interested
in
leveraging
AI.
About
80%
said
they
think
AI
will
“fundamentally
change
how
healthcare
benefits
are
managed
in
the
next
three
years.”
Employers
see
the
most
potential
for
AI
in
healthcare
through
tools
that
enhance
navigation,
personalize
decision-making,
improve
employee
experience,
streamline
benefits
communication
and
assess
healthcare
vendors.
“Employers
must
take
a
more
revolutionary
approach
to
address
both
immediate
cost
pressures
and
long-term
cost
trends,
especially
since
healthcare
costs
appear
firmly
on
an
upward
trajectory.
At
the
same
time,
employers
seek
innovations
in
clinical
programs,
technology,
and
effective
uses
of
AI
in
healthcare
to
address
the
burden
of
chronic
disease
and
to
help
people
protect
their
health,”
said
Courtney
Stubblefield,
managing
director
of
Health
&
Benefits
at
WTW.
Photo:
santima.studio,
Getty
Images