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Benefits April 1, 2026
How Employers Can Rein In Health Care Costs
Experts share how plan data can help drive sustainable outcomes.
Reported by
Emily Boyle
With health care costs expected to balloon in 2026, plan sponsors are keen on minimizing the burden their businesses and their employees will bear.
According to the Business Group on Health’s 2026 Employer Health Care Strategy Survey, employers predicted last year that health care cost increases for 2026 would come at a median of 9% above 2025 levels. While the ultimate cost increases remain to be determined, employers renewing fully insured health plans for 2026 faced average premium increases of 18% to 25%, with some groups seeing hikes exceeding 60%, according to the USI 2026 Employee Benefits Market Outlook. At the same time, pharmacy costs continue to surge, with specialty drugs now accounting for more than half of all prescription drug spending, the USI report found.
Meanwhile, employers have bumped containment of health care benefit costs to the top of their strategic priorities list, according to the Employer Health and Benefits Strategy Survey, 2026 from insurance risk management firm Brown & Brown Inc. Going into 2026, 42% of employers cited health care cost control for both the organization and its employees as their No. 1 objective, moving last year’s top goal, “attracting and retaining a competitive workforce,” down to third.
When Adelia Soremekun, senior director of total rewards at the Jackson Laboratory, sat down last year to strategize about her organization’s health plan, she says she wondered, “What can we control and what can we not control?”
While the prices charged by hospitals and pharmacies were not in her control, the organization was able to determine it could cut a point solution—a benefit intended to treat a specific condition.
The GLP-1 Cost
Jax, as the Jackson Laboratory refers to itself, did not make many changes to its plan for 2026, but Soremekun says the organization identified that it could eliminate its most significant cost driver—glucagon-like peptide-1 drugs—when used for treating weight loss.
GLP-1 medications were originally approved to treat Type 2 diabetes and have since been approved for weight loss. More than 2% of Americans took the drug to manage their overweight status or obesity in 2024—up nearly 600% from six years earlier, according to a May 2025 report from nonprofit health data provider FAIR Health.
The number of American adults diagnosed with obesity more than doubled over about 30 years, increasing to 107 million in 2022 from 34.7 million in 1990, according to a study from the Journal of the American Medical Association. The upward trend is expected to continue: The study found the number is expected to rise by 19 million to nearly 126 million people by 2035.
In an August 2025 study published by Mercer, 77% of surveyed employers named managing GLP-1 costs as their top health benefit issue. The list price for Zepbound, a GLP-1 drug manufactured by Eli Lilly and Co., is $1,086.37 each time the prescription is filled, according to Lilly’s pricing page.
Soremekun says while there was not a large proportion of Jax’s employee base taking GLP-1 drugs for weight loss, those who did take them cost the organization more than $1 million in 2025.
As when any change is made, there were mixed reactions among participants to losing coverage of GLP-1s for weight loss. To continue supporting employees desiring weight loss solutions, the Jax benefits team chose to promote other weight loss management options, such as using the subscription-based weight loss and wellness app Noom. Jax also teamed up with Cigna, its health insurance company, to speak with providers about prescribing generic formularies, rather than brand-name prescriptions, to keep employees’ drug costs as low as possible.
“We will continue to look at a strategy that does not require us to strip our plan,” Soremekun says. “That will always be the strategy: [Doing] whatever keeps our plan as is or enriches it.”
Soremeken adds that plan sponsors should not wait until plan renewal time to consider cost-management strategies. When an employer notices costs trending upward in one area or another, it can take measures to educate employees on how to control costs from their end, such as through maximizing their preventive care visits to catch conditions in their early stages.
Medical condition management is crucial so that existing claims do not become catastrophic claims, says Chana Bieker, a senior vice president and benefits consultant leader at Brown & Brown.
Following the Data
While an employer’s highest cost driver in 2026 may be GLP-1s for weight loss—as it was for Jax last year—Soremekun recommends that other plan sponsors follow the data on their demographics and charges to their health plan closely to understand where costs are coming from.
Jamie Greenleaf, a fiduciary consultant and co-founder of compliance platform Fiduciary In A Box, emphasizes the importance of looking at what plan features are most utilized.
“It’s important that employers are committed to overseeing their health care governance,” Greenleaf says. “They should take a deep dive into what they [offer], what is being used and what each piece is costing them.”
Greenleaf says the “beauty” of the Consolidated Appropriations Act of 2026, a bipartisan law passed in February, is that any covered health service provider expecting to earn at least $1,000 from providing a service to a plan governed by the Employee Retirement Income Security Act is required to disclose its compensation to the plan. The law is intended to ensure health plan fiduciaries receive transparency in pricing.
Greenleaf says her advice to plan sponsors is to take a “fiduciary lens” to controlling costs, recognizing their duties to the employees they serve. That includes ensuring that the third-party digital tools an employer adds to its benefits to address specific health conditions, such as diabetes and obesity treatments, are benefitting the employees, rather than simply driving up plan costs.
Kelly Polinski, vice president of population health and well-being at Brown & Brown, says that if a program added to a plan is designed correctly, it “pays dividends.”
Polinski explains that expenses “should be warranted and defer costs from your plan, if your plan is being managed correctly”; a program should not be “an additional incurred expense.”
As fiduciaries to health plans, employers also should enforce plan rules to boost internal control of health care costs, such as by conducting eligibility audits every three years or so, according to multiple experts. An employee’s adult child may have aged out of qualifying for coverage as a dependent by turning 26, for instance, and an audit can help identify and remove the ineligible person from the plan.
Payment integrity is another way to at least begin to help control costs, Greenleaf says. Insurance companies can make mistakes when it comes to billing for claims, and some employers and employees end up paying for services that are either double-coded or never rendered.
“Third-party administers, who adjudicate claims, could be owned by the network and therefore have no incentive to make sure the payment was made correctly,” Greenleaf explains. “By using an outside, unbiased payment integrity platform, you’re ensuring what you’re paying for is not only reasonable but correct.”
The Future of Benefits
Brown & Brown’s Polinski says plan size matters, too.
“The economies of introducing certain solutions becomes tenable at scale,” Polinski explains. For example, covering second evaluations for treatments of rare cancers might be harder to cover a plan at a smaller employer than at a larger one. “Small-to-mid[size] employers will have to collaborate with others to aggregate [insured] lives, whether through … consortium or through working with their insurance carrier to make some solutions make sense.”
Meanwhile, there has been a “generational evolution” of what is expected from a health plan, fueled by younger employees, including those that are members of Generation Z, according to Polinski. She calls younger employees “digital natives” comfortable with the idea of sharing their data, such as in a health and wellness app, who in return expect to have highly personalized experiences with the provider or app. As the expectations of the workforce evolve, Polinski recommends that plan sponsors take a multi-year approach to determining where they will allocate their benefits dollars.
On the supply side, some employers are stacking up targeted third-party solutions, which Polinski likens to purchasing streaming services. But to make the stacking worth it, employers need to reallocate money from their traditional health care budgets.
“They’re getting a Netflix subscription, … and at the end of the day, they’re wondering, ‘Why am I still paying for cable? The old model is not really working for me,’” she says. “They’re demanding more and better as consumers.”
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