Mercer’s preliminary findings from its 2024 National Survey of Employer-Sponsored Health Plans reveal that health benefit costs per employee are projected to rise by 5.8% on average in 2025. This marks the third consecutive year of cost increases above 5%, following a decade of relatively moderate growth averaging around 3%. The survey, which analyzed responses from over Prescription drug costs remain a major factor, with employers reporting a 7.2% increase in drug benefit expenses per employee in 2024, driven in part by costly new gene and cellular therapies. The survey also highlights a growing trend of employers implementing cost-cutting measures, with 53% of employers planning changes to their plans in 2025, such as raising deductibles and cost-sharing provisions. As employers balance healthcare affordability for employees with managing organizational costs, this trend is expected to continue, potentially leading to higher out-of-pocket costs for employees. The final survey results are expected later this year.
Mercer Survey Predicts 5.8% Rise in Employer-Sponsored Health Plan Costs for 2025
1,800 U.S. employers, notes that smaller employers with fully insured health plans are expected to face the sharpest increases, with costs potentially rising 9% without intervention. Key contributors to these rising costs include price dynamics driven by the shortage of healthcare workers and the ongoing consolidation of health systems, which grants larger providers greater negotiating power.