The New Benefits Equation: Cost, choice, and value in an uncertain economy

Employers have been dealing with rising healthcare costs for years, but the increases they’re facing now are making some of the usual responses harder to sustain.

That was the focus of a recent Alegeus webinar featuring Patrick Sweeney, Partner at Mercer, and Jessica Cluff, Director, Consultant & Broker Relations at Alegeus. They talked about what employers are seeing as they plan for 2027, where their strategies are changing, and how they’re trying to balance affordability with a benefits experience that still works for employees.

Patrick shared that employers are bracing for another year of significant healthcare cost increases in 2027, with pharmacy costs adding to the pressure, according to a recent Mercer survey.

Higher deductibles, employee contributions, and other plan changes have helped employers absorb increases in the past. But continuing down that path can make care harder to afford and lead employees to put it off.

That’s pushing employers to explore more options, including high-performance networks, provider incentives, centers of excellence, and plan designs that encourage people to seek higher-quality, more cost-effective care.

Over the past several years, employers have added programs to address specific conditions, populations, and cost drivers. The result for some has been a crowded benefits ecosystem that takes significant time to manage without always producing clear results.

Patrick described clients who have found themselves spending more time on vendor management than benefits strategy. With healthcare costs drawing greater attention from finance leaders, there’s also more pressure to show that each investment is doing what it was intended to do.

That’s leading some employers to consolidate programs and put more emphasis on measurement, integration, and the overall experience they’re creating.

Employers should also consider what changes mean for the people using their benefits. Patrick shared the example of plan designs that give employees more certainty about what they’ll pay for a procedure. A maternity patient, for instance, might know her cost ahead of time even if a planned delivery becomes a C-section. That predictability can improve the experience even when the plan itself doesn’t generate significant savings.

There was plenty more in the conversation, including how employers are approaching GLP-1 coverage, what’s happening with HSAs and lifestyle spending accounts, where newer plan designs are gaining traction, and the roles AI, data, and benefits administrators could play as strategies become more complex.

Watch the full webinar via the link below to hear Patrick and Jessica dig into these issues and share what they’re seeing in the market.

Watch the webinar