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What keeps HR leaders up at night? Balancing care for their people with protecting their organization's future. One costly treatment can jeopardize a benefits plan, so leaders are turning to smart, multi-layered cost strategies to protect both lives and livelihoods. By choosing the right plan designs for their unique needs, HR and finance can safeguard both employee wellbeing and organizational stability.

Rising costs and strategic solutions: Navigating the future of employee benefits

Million-dollar claims up 50% over last 4 years. Medicare-eligible employees on employer group plans cost an average of $12K per year. 49% of employers plan to add a wellbeing strategy by 2026.

Supporting employees: Lower-cost alternatives to group health plans

Alternatives to group health plans include COBRA, Medicare, competitive individual plans for non-Medicare-eligible retirees and affordable health options for part-time and non-benefits eligible employees.

Connecting care, cost, and culture through wellbeing

An effective wellbeing strategy does more than offer perks. By connecting wellbeing to outcomes like chronic disease management, productivity and financial risk reduction, you can build a stronger case for C-suite support.

  1. Address preventive care: Identifying gaps in preventive care can lead to significant cost-saving opportunities for disease prevention and management. Consider that employees with diabetes incur health care costs 2.6x higher than those without the disease.5
  2. Align wellbeing with organizational goals: Integrate wellbeing programs with metrics like claims cost reduction and high-performance culture, focusing on financial ROI and outcomes such as reduced absenteeism and improved retention. Prioritize safety by tracking accident-free days and enhance sleep health for a safer workplace.
  3. Streamline point solutions: With 70% of employers citing participation as their biggest wellbeing challenge,6 simplifying your approach can make a big difference. Focusing on fewer solutions that deliver the most value based on employee demographics can eliminate the unnecessary (and costly) overlap of resources.

Safeguard against soaring claims with stop-loss insurance

As the cost of care continues to climb, employers are feeling the pressure. Both self-funded and fully insured groups of all sizes are exploring protective strategies like bundled case agreements, centers of excellence, and stop-loss coverage.

  1. Prepare for rising costs: Employers can routinely anticipate an 18% to 22% rise in premiums annually. Popular but costly medications like GLP-1s drive up claims when few employers are ready to pass additional costs onto employees.
  2. Recognize surge in high-cost claims: High-end claims are rising fast by an estimated 30% to 60% annually. What once were top-tier claims in the$3 to $5 million range are now reaching $10 to $15 million due largely to the growing list of approved cell and gene therapies.1
  3. Implement winning strategies through centers of excellence: Gallagher connects employees with the right care at the right time, helping reduce misdiagnosis and unnecessary treatment. We advise on cost-saving strategies based on risk, claims, and projections—partnering with vendors and providers to deliver tailored, cost-effective solutions."

35% of Mayo Clinic Complex Care Program participants avoided a locally recommended surgery.

Balance healthcare costs while enhancing employee engagement. Contact your Gallagher consultant today.

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Sources

1"High-Cost Claims and Injectable Drugs Analysis," 2024 edition. SunLife, accessed 20 May 2025.

22024 Gallagher case study, Alternative Health Solutions. Internal document.

32024 Gallagher Benefit Strategy & Benchmarking Survey. Internal document.

4Purvis, Leigh "Most Medicare Part D Enrollees Who Reach the New $2000 Out-of-Pocket Spending Cap Will See Substantial Savings Despite Premium Changes," AARP, 16 Jan 2025.

5"Facing the Diabetes Cost Crisis: A Guide for Employers," American Diabetes Association, accessed 20 May 2025. PDF file.

62025 Gallagher Benefits Strategy & Benchmarking Survey. Internal document.

7"Complex Care Program: An Employer Health Solution," Mayo Clinic, accessed 20 May 2025.

Disclaimer

Consulting and insurance brokerage services to be provided by Gallagher Benefit Services, Inc. and/or its affiliate Gallagher Benefit Services (Canada) Group Inc. Gallagher Benefit Services, Inc. is a licensed insurance agency that does business in California as "Gallagher Benefit Services of California Insurance Services" and in Massachusetts as "Gallagher Benefit Insurance Services." Neither Arthur J. Gallagher & Co., nor its affiliates provide accounting, legal or tax advice.