Healthcare costs are once again climbing at unsustainable rates. In 2025, U.S. employer healthcare spending grew by 7%, the fastest pace in over a decade. Projections suggest that costs could rise another 6–8% annually through 2028, outpacing wage growth. The latest Lockton National Benefits Survey reinforces just how pressing this issue has become, finding that controlling healthcare costs now ranks as the number one benefits priority for employers— even surpassing concerns about employee retention and recruitment.

For workers, this translates into higher premiums, deductibles, and out-of-pocket expenses. A Kaiser Family Foundation survey found that nearly half of U.S. adults skipped or delayed care in 2025 due to cost concerns. This not only harms employee well-being but also increases long-term costs for employers when untreated issues escalate.

For employers, there are tough questions and trade-offs. To manage budgets, many are grappling with whether to cover GLP-1s for weight loss and strategies that could shift costs to employees, narrow provider networks, or reduce coverage. Others are turning to digital health solutions and preventive care programs, and hoping to lower the volume of claims.

At the same time, workers are increasingly dissatisfied, and healthcare affordability has become a top driver of job changes. Mercer found that 35% of employees would switch employers for better healthcare benefits, even at the same pay.

Innovative, forward-thinking employers are adopting transparent pharmacy and health benefit solutions more rapidly than ever before. Others like Walmart and Amazon are expanding inhouse healthcare clinics, and point solutions for everything from telehealth to family planning, mental health, and chronic condition management are expanding their service offerings and partnering with employers to deliver specialized care. These models aim to provide more affordable, accessible, and transparently priced options to plan members without sacrificing service levels.

Still, systemic challenges remain. Prescription drug spending continues to climb, mental health needs are rising, and the aging workforce drives demand for these services. Without broader policy reform or the adoption of innovative solutions, employers and employees will continue to face pressure.

Employee health and wellness, and the associated costs, are more than a benefits issue — they are a competitiveness issue. Employers who can deliver affordable, comprehensive care will stand out in a tightening labor market. Those who cannot risk losing talent and facing declining productivity from an unhealthy workforce.

Source: Workplace Intelligence