Theresa Stenger
Specialty Practice Leader | Employee Health & Benefits
Offering competitive employee benefits that help employers attract and retain talent has never been more challenging. With higher-than-average healthcare trends expected to continue for several years, employers are grappling with stretched budgets and rising benefits costs. The need for effective strategies to manage benefits budgets is more essential than ever. Employers are operating in a high-cost environment where every dollar counts.
According to the Employee Benefits News State of Healthcare 2024 Report, 89% of employers are taking steps to lower their healthcare costs. Unfortunately, many brokers and consultants tend to react to renewals rather than proactively plan and strategize to combat these rising costs. According to a recent Imagine 360 survey, only 50% of employers have seen a reduction in their healthcare costs due to the strategies or recommendations provided by their broker, and only 42.5% of C-suite respondents felt their broker had a long-term strategy to reduce health insurance costs.
Let’s face it: Healthcare costs are out of control. According to the Mercer 2024 National Survey of Employer-Sponsored Health Plans, healthcare costs are projected to increase by 7% before plan changes, with employers seeing a 5.4% trend after plan design changes. But is that enough?
In a separate study, Mercer asked CFOs what a sustainable annual increase in healthcare costs for their organizations over the next three to five years would be. Ninety-four percent of respondents think it must be less than 4.9%.
