Despite Rising Medical Inflation, Employers Continue to Protect Workers and Enhance Health Benefits, Study Shows

High health care costs continue to impact Americans. Despite cost pressures, employers continue to prioritize providing affordable high-quality health care to workers, reducing costs for American families. These are the findings from a recent survey of American businesses about their plans for workplace health care in the year ahead. 

The big picture: As the single largest source of health benefits in the U.S., employer-provided coverage makes high-quality care accessible to more than 160 million Americans. It remains the best system to adapt to and address the needs of workers and their families. Employers recognize this value and are prioritizing efforts to shield workers from rising costs. Further, recent advancements in telehealth are bridging traditional geographical divides, improving access and quality of care while also helping boost growth in rural regions.

Zooming in: In a recent survey of U.S. employers, Mercer found that the majority of employers will not cut health benefits or raise employee contributions to coverage despite rising costs, and many will make enhancements to their current programs into the new year.

Here’s what employers are planning for 2025:

• Improve affordability: Two-thirds of large employers say that lowering the cost of coverage is a priority so workers can keep more of their paycheck. Employers are also finding ways to remove financial barriers for workers by offering plans with no/low deductibles or telehealth services. As Mercer notes, “Many will use high-performance provider networks or other strategies to steer employees to higher-quality, lower-cost care next year.” 
• Prioritize workers’ needs:  Even though specialty medications contributed to overall health care cost increases this year, Mercer found employers are more likely to add coverage for these medications than drop it.
• Enhance coverage for reproductive health and access to mental health services: Employers are boosting support in areas of reproductive health – for women and men – including pre-conception planning, support for high-risk pregnancies and return-to-work support. Mercer found 62% of employers will offer one or more of the listed reproductive health benefits next year, up from 46% in 2024. Employee assistance programs (EAPs) have also been expanded to offer more modalities for mental health care, with 45% of respondents offering greater care options, including in-person coaching or counseling, Cognitive Behavioral Therapy, and meditation apps.

Bottom line: This study reinforces why people with employer coverage consistently and overwhelmingly report satisfaction with their insurance. Employers know that providing quality coverage is beneficial for their workforce and ultimately good for them as well. The system works, and businesses are committed to it as it’s the most innovative, responsive way to meet the personalized health care needs of workers and their families.

 The Protecting Americans' Coverage Together campaign is a coalition that includes the U.S Chamber of Commerce, Business Roundtable, Vermeer Corporation, the National Association of Manufacturers and Council for Affordable Health Coverage. PACT represents leading employer voices focused on strengthening employer-provided coverage and protecting the benefits that American families depend on for their health.