U.S. employers are projecting health benefits costs to increase by eight per cent for 2025, up from seven per cent in 2023, according to a new survey by the International Foundation of Employee Benefit Plans.
It found employers cited several factors in rising costs, including catastrophic claims (20 per cent, up from 19 per cent last year), specialty/costly prescription drugs (20 per cent, up from 16 per cent last year), medical provider costs (18 per cent, up from 14 per cent last year) and utilization due to chronic health conditions (16 per cent, down from 22 per cent last year).
Read: U.S. employer-sponsored health benefits costs expected to rise 7% in 2024: survey
Among employers that selected specialty/costly prescription drugs as a primary reason for the cost increase, three-quarters cited glucagon-like peptide-1 drugs (75 per cent) as the predominant factor, followed by other specialty drugs (31 per cent) and cell and gene therapy (19 per cent).
When asked about initiatives that would help manage costs, employers cited utilization control initiatives (27 per cent, up from 22 per cent last year), cost-sharing initiatives (21 per cent, up from 16 per cent), plan design initiatives (15 per cent, up from 12 per cent) and purchasing/provider initiatives (nine per cent, down from 12 per cent).
“Employers are reporting that catastrophic claims and specialty drugs are amongst the significant drivers of the health-care cost increases,” said Julie Stich, vice-president of content at the IFEBP, in a press release. “During 2024, employers have been implementing several strategies to manage costs, with an increased focus on utilization control and cost-sharing initiatives.”
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