Health Care Costs Increasing in 2023

2.5 minute read

Industry experts agree that employers should expect major health care increases in 2023. Employers must find a way to reign in rising health care costs while finding quality and affordable options for their current and prospective talent despite their shrinking budgets.

Why Costs Are Increasing

There are a few reasons why health insurance costs are rising. During the COVID-19 pandemic, claims costs were low. Now medical plan costs are returning to pre-pandemic levels as health care utilization rebounds. Other issues affecting health care costs include inflation, employees making up for delayed or missed care, and catastrophic claims.

Strategies for Managing Health Care Costs and Improving Affordability

Traditionally, employers would have shifted the increased costs onto employees through higher premiums. But because of the current state of the labor market, many employers don’t want benefit choices to interfere with their recruiting efforts. So, employers are using multiple strategies to manage their health care cost while attempting to improve affordability for their employees.

These strategies include:

• Switching to low-deductible health plans
• Contracting directly with high-quality, cost-competitive hospitals and physical networks
• Offering employees health care navigation and concierge support services
• Evaluating prescription drug costs
• Increasing health care plan budgets
• Structuring payroll contributions to reduce health care costs for employees
• Providing telemedicine or wellness programs
• Expanding voluntary benefit offerings
• Supporting and effectively managing employees with chronic conditions

By gathering data and using it to predict where and when increased costs may occur, employers can determine the best strategies to address growing health care costs. Download the bulletin for more details.

This blog is intended to be a compilation of information and resources pulled from federal, state, and local agencies. This is not intended to be legal advice. For up to the minute information and guidance on COVID-19, please follow the guidelines of the Centers for Disease Control and Prevention (CDC) and your local health organizations.