Benefits leaders today are contending with intensifying challenges: regulatory changes such as pay transparency and welfare reform, balancing AI-driven efficiency with data privacy concerns, managing office return strategies and addressing rising cost pressures. Amid these competing priorities, workforce wellbeing support can feel like an optional perk, rather than a business necessity.
HR leaders may understandably ask: isn't it an employee's job to take care of themselves? Can't we leave healthcare provision to the state? Where does our responsibility for an individual's health start and end?
On the contrary: investing in workforce health makes hard business sense.
Absenteeism and rising claims costs are eroding profitability. WTW's 2026 Absence Management Survey results reveal that over half of UK organisations face mounting challenges from absence and disability costs. And it's not just absence. Private healthcare costs remain a significant concern. WTW's 2026 Global Medical Trends Survey forecasts UK medical inflation to remain in double digits at 10% for 2026. This is driven by a multitude of factors including rising demand, cancer incidence, mental health needs, pharmacy costs and new medical technologies.
In the past, employers might have decided that unwell people were best looked after by state healthcare systems and invested in other benefits. Sadly, this isn't necessarily true today. In the UK and many other countries, state healthcare systems are under strain with too much demand and not enough resources.
For example, in England, the waiting list for NHS hospital treatment is 7.3m cases (with 2.8m patients waiting over 18 weeks for the treatment they need[1]). Following analysis of GP appointment availability in December 2024, it was found that a staggering 4.8m patients were unable to reach their GP on the same day and 2.2m experienced multi-day delays.[2]
The UK Welfare Reform and the Keep Britain Working Review are driving significant regulatory pressure for employers to take a more active role in tackling the growing economic burden of ill health and disability. The final Keep Britain Working report, published in November 2025, sets clear expectations for employers to proactively manage workforce health. Under the new regulations, businesses must provide greater transparency on health and absence data, demonstrate measurable outcomes from wellbeing investments and adopt practices that help keep people in work longer.
UK employers invest billions in wellbeing, yet most lack clarity on what delivers results. WTW's 2026 Absence Management Survey shows 53% can't quantify absence costs — creating financial and operational risk. The Keep Britain Working Review recommends launching a Workplace Health Intelligence Unit in early 2026 to collect data, benchmark performance and drive reform. Beyond the Vanguard phase, all employers must report standardized health metrics for compliance.
Regulatory pressure aside, businesses need better visibility to prove ROI, identify health hotspots and manage long-term risk. Consolidating data on premiums, claims, absence and occupational health spend is critical — but many frameworks miss deeper insights like clinical trends, demographic profiling and horizon scanning. These enable targeted investment, programme optimisation, integration and evidence direct links between health strategy and productivity.
Wellbeing is no longer a perk — it's a strategic lever for cost control, growth and business performance. It belongs at the heart of workforce strategy.
Employers are currently under unprecedented pressure. The state expects workforce wellbeing programmes to deliver measurable improvements in employees' ability to work, even as budgets tighten. At the same time, employees demand more from their benefits.
In our conversations with HR, Comp & Ben and Wellbeing leaders, many organisations ask how insurers can evolve faster to help meet these rising pressures. The employee benefits market, long considered traditional, is ready for transformation.
We are working with some of the largest insurers to drive meaningful innovation and change in the UK market - redesigning products to close coverage gaps, integrate seamlessly with broader benefits and provide cost-effective, accessible care. This approach paves the way for earlier interventions, optimised benefit programmes and pathways, and reduces reliance on overstretched state systems.
AI also holds significant promise for meeting increasing needs - offering faster access to support, personalised recommendations and more streamlined employee experiences.
However, in the UK and European employee benefits markets, AI adoption remains at an early stage and is far from a complete solution.
Its application must consider generational differences, adoption hesitancy, data privacy concerns and fragmented data ecosystems. A major barrier is the lack of integration between state health data and private insurance carrier data; without reliable, comprehensive datasets, AI can't realise its full potential. In essence, AI can enhance accessibility and personalisation, but meaningful impact will depend on developing integrated data strategies and smarter, more connected benefit structures.
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Visibility is the foundation for effective workforce health management. Employers need robust, consolidated reporting on absence costs, claims utilisation, occupational health spend and related expenses. Without this, it's impossible to forecast budgets, demonstrate ROI, or identify health hotspots requiring intervention. We help organisations integrate fragmented data sources, apply clinical insights and build advanced analytics frameworks that link health strategies directly to productivity and performance.
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Medical inflation, rising disease burden and increasing utilisation are driving direct and indirect absence costs and premiums higher. Employers must review their absence management policies, intervention points, benefit structures and triage points between plans to ensure they are fit for purpose and serve your organisational structure and heath needs. It is vital that coverage gaps are closed, improving integration with other benefits and enabling early intervention.
Plan redesign should also anticipate future trends, such as new treatments and evolving workforce demographics. We work with employers to benchmark against peers, provide best-practice insights on processes and policies, negotiate with carriers and implement innovative plan designs that optimise cost efficiency while improving health outcomes.
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Maximising use of value-add wellbeing services, vendor triage and alignment opportunities. AI and digital tools can simplify access to benefits, personalise employee experience, drive better health outcomes and, in the mid to longer term, reduce overall spend.
Employers should focus on connecting vendors, reducing vendor complexity and ensuring engagement solutions work for diverse workforces. We advise organisations on their vendor strategy, programme integration and technology enablement. This helps employers create streamlined, cost-efficient solutions that enhance engagement and deliver measurable impact.
We work with employers to define strategy, drive innovation and optimise health and benefits programmes. From advanced analytics and plan redesign to vendor consolidation and technology enablement, we help organisations future-proof their approach and deliver measurable business impact. Connect with our Health and Benefits team today to learn more or take our absence management survey and receive a personalised benchmark report to see how your absence management strategy compares to your peers.
