Our 2025 Best Practices in Healthcare Survey found that there’s a projected 9.1% increase in healthcare expenses for 2026. Some employers are already facing double-digit hikes. Many are questioning the sustainability of current benefits while trying to remain competitive in attracting and retaining talent.
A small portion of members drive a large share of costs: 5% account for 56% of total spending, and just 1% are responsible for 28%. Claims once considered high-cost at $50,000 now often start at $100,000, with multimillion-dollar claims increasingly common, driven by advanced treatments like gene therapy or complex conditions such as congenital disorders and transplants.
While some high-cost claims stem from sudden events like trauma or acute illness, they more often involve chronic, complex conditions requiring long term, expensive care. These include cancer, NICU stays, cardiovascular disease, sepsis and neurological or blood disorders. High-cost claims are also shifting demographically, with younger members affected due to neonatal care, genetic disorders and mental health.
Employers must analyze member and claims data to target high-impact areas. Key focus areas include:
Employers are moving beyond traditional tactics and adopting more targeted clinical strategies:
Addressing today’s cost pressures demands more than traditional approaches. While tools like plan design and stop loss remain important, sustainable impact now depends on clinically driven strategies. Employers must urgently implement short- and long-term solutions rooted in clinical effectiveness, collaboration and accountability.
The 2025 Best Practices in Healthcare Survey projects a 9.1% increase in healthcare expenses for 2026, with some employers facing double-digit hikes. High-cost claims, particularly those exceeding $100,000, are a significant contributor to this trend. These claims are often driven by complex conditions such as cancer, NICU stays, cardiovascular disease and advanced treatments like gene therapy.
A small portion of members drive a large share of costs. Specifically, 5% of members account for 56% of total spending, while just 1% are responsible for 28% of the costs. This highlights the importance of targeted strategies to manage high-cost claims.
A disproportionately small group of members contributes to the majority of expenses. In fact, 5% of members generate 56% of total spending, with the top 1% alone responsible for 28%. These figures underscore the critical need for targeted interventions to effectively manage high-cost claims.
Employers are shifting beyond traditional tactics like plan design and stop loss insurance. They're now adopting more targeted clinical strategies, analyzing member and claims data to identify high-impact areas and implementing clinically-driven solutions that focus on effectiveness, collaboration and accountability. This strategic shift aims to provide sustainable cost management while maintaining competitive benefits for attracting and retaining talent.
Employers are moving past conventional approaches such as plan design tweaks and stop loss coverage. Instead, they’re embracing precision-driven clinical strategies — leveraging member and claims data to pinpoint high-cost areas and deploying solutions rooted in clinical effectiveness, cross-functional collaboration and accountability for outcomes. This evolution reflects a broader commitment to long-term cost control while maintaining robust, competitive benefits that help attract and retain top talent.
