Survey States Health Benefits Cost Will Grow in 2023

2 minute read

According to the early results from Mercer’s National Survey of Employer-sponsored Health Plans 2022, the average health benefit cost per U.S. employee is expected to increase by 5.6% in 2023. This percentage accounts for changes employers plan to implement to reduce their overall health care expenses.

Most employers aren’t likely to experience the full impact of the current price inflation due to multiyear contracts with their healthcare providers. However, they should expect price inflation to be factored into the costs of health plans over the next few years (as contracts expire and providers negotiate higher reimbursement rates).

Employers are trying to balance record-breaking inflation and rising health care costs with their attraction and retention efforts. Eighty-four percent of survey respondents said it was an important or very important strategy to enhance employee benefits like telemedicine and employee assistance program services. In the survey, enhancing employee benefits even outranked managing high-cost claimants, which historically has been a large employer’s highest priority.

Results also show that employers will not generally increase their employees’ share of the health plan costs in 2023. Only 36% of large employers planned on implementing cost-cutting measures like increasing deductibles or copays. Instead, employers are trying to keep more money in employees’ pockets and remove cost barriers to health even through health care costs continue to rise.

Despite the recent decrease in health care utilization, price inflation is expected to continue to increase for the foreseeable future. Employers may not be feeling the full impact of price inflation in their health care plans now, but they can start to reign in rising health care expenses and better position themselves to address future increases within their plans. Download the bulletin for more details.