BenefitsPro: 2024 employee benefits & workplace predictions: Health care landscape

By Lily Peterson

Costs have always been a concern for both employees and employers when it comes to health care. Benefits pros are constantly thinking about how to save money for employers while premiums continue to rise. It’s a battle, but a battle worth fighting.

Paying for change

“If we want to change health care, we must change the way we pay for healthcare. Centers for Medicare and Medicaid Services (CMS) has been leading the charge for Medicare and Medicaid.  Looking ahead, Congressional Budget Office (CBO) projects that the Center for Medicare and Medicaid Innovation (CMMI)’s activities will increase net federal spending by $1.3 billion, or 0.01% of net spending on Medicare, over the center’s second decade, which extends from 2021 to 2030. And this is playing out elsewhere as well.

“For example, it’s getting more attention in the Pharmacy Benefit Management (PBM) space, most recently in CVS’s new approach to prescription drug payments. But we believe employers purchasing health care for their employees will also rethink the incentive structure behind health care, particularly how providers are paid. We expect employers to demand more transparency with how carriers are paying providers and push to pay for value versus today’s reality of units of care consumed. Employers will look for solutions (in particular, health plans) that can facilitate transparency and alignment of incentives between employers and providers.” - Ashok Subramanian, CEO, Centivo

Increased focus on maternal health, including doula care

“Maternal deaths across the U.S. have more than doubled over the past two decades, and unfortunately, we continue to see a rising rate. Despite having one of the most advanced health systems in the world, the U.S. currently has the highest pregnancy-related death rate among developed nations.

“Over the past year, we’ve seen a growing recognition of the importance of comprehensive support for individuals throughout the phases of pre-pregnancy, pregnancy, childbirth, and the postpartum period. For example, the FDA approval of zuranolone to treat postpartum depression (a staggering 20% of postpartum deaths are due to suicide), the rise of doula care to help supplement maternal care, and the passing of the Pregnant Workers Fairness Act.

“As we head into 2024, I am confident that we’ll see more investment in maternal care initiatives, specifically doula care (both in-person and virtual), continue to rise. At Carrot, we’ve already seen this trend, with 1 in 5 Carrot members utilizing our doula support on their pregnancy journeys. I anticipate this to continue as people start to realize the impact they can have on increasing access to ongoing care, and improved outcomes, especially for marginalized communities.” - Dr. Asima Ahmad, Co-founder and Chief Medical Officer, Carrot Fertility

Battling health care costs

“HR leaders are being challenged to maintain quality benefits that are affordable for both their organizations and employees, as health care costs are set to rise 8.5% in 2024 absent actions to rein them in. Though inflation is subsiding, health care providers are pushing insurers for larger cost increases to cover the higher costs of wages and supplies that they endured during the last couple years but were unable to pass these overhead expenses on to payers.

“Additionally, Aon predicts GLP-1 drug costs will continue to fuel health care spending growth, increasing from $324 per health plan member today to $500 per health plan member by the end of 2025. As more GLP-1 drugs are approved by the FDA, either as new medications or expanded indications of current GLP-1s, Aon anticipates increased demand due to U.S. obesity prevalence rates and the sheer volume of potential new patients. In addition, recent GLP-1 research is showing positive health outcomes in other disease states including cardiac care. In 2024, employers will look to manage the GLP-1 category through strategies focused on medical appropriateness and long-term, sustainable outcomes. These strategies include utilization management, plan design, specialized prescriber networks and cardio-metabolic point solutions that support patients with diet, exercise, medication adherence, and behavioral health programs.” - Tracy E. Spencer, SVP and National Pharmacy Practice Leader, Aon

Employers will reject buzzy weight loss drugs

“Despite all the consumer and media buzz around weight loss solutions like Ozempic and Wegovy, we won’t be seeing widespread employer support for the drugs in 2024. With a hefty price point of $800 -$1700 per person, weekly injections could cost the U.S. more than a trillion dollars annually – and employers are steering clear of the financial burden in favor of sustainable weight loss solutions that focus on nutrition and lifestyle changes.”  - Sami Inkinen, Founder & CEO, Virta Health

Establishing a comprehensive health care benefits strategy

“In response to rising costs, we can expect higher premiums across the board next year, incentivizing employers to find new ways to extract value from their benefits plans and find ways to avoid further cost-shifting to employees, whether that be expanding their voluntary benefits portfolio or improving employee education strategies. More broadly, as employers continue to evolve with a changing market, they’d be well-served to standardize their overall health care benefits strategy in 2024, rather than constantly adapt offerings based on emerging trends that might not stick around. Establishing a comprehensive health care benefits strategy will avoid an overuse of expensive, inefficient point solutions that may be trendy in the moment but out-of-style soon after. Consistency is a more effective approach amidst the swiftly changing landscape of trends.” - Kim Buckey, VP of Customer Service, Optavise

Prioritize solutions that address these challenges

“Last year was all about doing more with less for employers. But benefits complexity didn’t decrease, nor did the costs associated with offering comprehensive benefits packages. 2024 will see employers become savvier buyers of benefits technology as they prioritize solutions that address these challenges. Expect to see ben-admins and insurance carriers focus on delivering consolidation and automation through digital capabilities that take the pressure off employers. Investments in cleaner data will also lay the groundwork for artificial intelligence applications in employee benefits, including care navigation, decision support, and self-help billing tools.” - Shannon Goggin, CEO and co-founder, Noyo

Endless premium hikes

“The average premium for health insurance has risen 54% over the last decade.  Employers know that endless premium hikes are unsustainable and will need to find novel strategies to make their plan benefits more affordable and effective. Health insurance captives will continue to be a workable means to cut costs and improve care.” – Jeff Faber, Chief Strategy Officer, HUB International

Taking an employee-first approach to benefits prioritization

“With the labor market shifting, return-to-office projected to remain a priority, and generational gaps widening, we’ll see employers take a step back next year and ask themselves what truly matters to employees and align their benefits priorities accordingly. They’ll create employee-first benefits programs by diving the deepest they ever have into understanding the needs and wants of their workforce to provide a supportive environment that meets them at the stage of life they’re currently in and even where they may find themselves in years to come, from entering the workforce to family planning to retirement. This takes into account their career motivations and aspirations as well as planned and unplanned life situations; for example, it could look like prioritizing the creation of a learning and development program for Gen Zers who started their careers remotely and are now navigating hybrid work, or investing in childcare benefits for millennials juggling the demands of family life and work. Taking this approach of delivering benefits that are meaningful and inclusive of all employees will be the determinant of thriving, best-in-class workplaces in 2024 and beyond.” - Wes Burke, Chief Human Resources Officer, Care.com

ICHRAs are growing in popularity

“Individual Coverage Health care Reimbursements have tripled in popularity over the last few years, and can be an ideal option for many employers seeking a flexible and personalized way to fund employee health benefits while enjoying group plan tax breaks. At Gravie, we recently conducted a nation-wide survey and found that 89% of benefits decision-makers are likely to consider health benefits through ICHRA for their employees in the next three years, and 87% think ICHRA could be a long-term fit for their company. Brokers and employers are innovating with ICHRAs through strategic partnerships – offering them alongside group health plans to meet the needs of unique segments of their population such as seasonal, part-time, non-salaried, or geographically dispersed employees. We encourage employer groups of all sizes to consider if they might fit into their benefits strategy.” – Andrew Reeves, Senior Vice President and General Manager, Gravie ICHRA

Cancer journey support is a priority

“Ask any HR leader what they are thinking about, and cancer continues to be a leading care cost driver. Oncology drug shortages will persist, impacting treatment. Together, these cost and shortage challenges will push employers to identify and offer benefits that support their employees and their families and caregivers throughout the cancer journey—from diagnosis to remission. Employers will seek solutions that ameliorate financial burdens and prioritize personalized, holistic care, ensuring employees feel supported and empowered to make informed decisions.” - Mary Mulcare, MD, Chief Medical Officer, Summus

Preventative health initiatives

“Preventative health initiatives for employees will take greater priority. This “prevention is better than cure” adage covers many themes, including fitness and nutrition. 2024 will see a major strategic shift from reactive to proactive employee wellness approaches. Research has shown that it can create long-term benefits for employees, as well as reducing costs associated with treating preventable conditions. Advances in AI will play a major role here, enabling employees to spot early warning signs and implement rapid response.” - Wesleigh Roeca, Director of Business Development, Lifesum

Menopause and age-inclusive benefits

“Despite the fact that 1 in 5 women in the workforce are going through menopause, age-inclusive benefits for this under-supported phase of life are far from being a standard of benefits packages today. In 2024, we’ll see more and more employers prioritize investing in menopause support. The type of benefits we’ll see employers invest in are ones that go beyond just treating hot flashes and instead address all the invisible symptoms a person experiences —their mental health, nutrition, and physical needs. We’ll also see employers try to make their workplaces more menopause-friendly, from implementing flexible leave policies that can be used for symptom management to ensuring that physical office environments are inclusive and accommodating of people navigating perimenopause and menopause.” - Isha Vij, VP of Employer Growth, Maven Clinic