Growing healthcare costs

Rising health care costs are creating significant challenges for employers, with 100 percent of companies indicating that rising costs will affect their ability to remain competitive (up from 88 percent in 2025), according to recent research from the Midwest Business Group on Health. The 2026 Employer Survey found that 98 percent of companies believe that health and well-being benefits are critical to attracting and retaining employees, but 81 percent still expect to shift more costs to employees.

Leading affordability concerns are drug prices and high-cost claims. The survey found that nine in 10 employers feel that high drug prices are a significant threat. Employers are taking action to address pharmacy concerns—26 percent indicate they have made a pharmacy benefit manager (PBM) change during the past year, and 43 percent are considering a change in the next one to three years.

High-cost claims follow closely behind drug costs at 87 percent as a major concern. To mitigate high-cost claims, 77 percent of employers are purchasing stop-loss coverage and using care navigation and advocacy enhanced case management – an increase from 49 percent and 54 percent from last year, respectively.

NOTE: WCI offers cost-saving healthcare opportunities for employers, including a captive plan with stop-loss coverage for groups over 50, and competitive alternatives for groups under 50. For more information, see our WCI insurance web page.

From WCI's HR Answers Now ©2026 CCH Incorporated and its affiliates. All rights reserved.