Aon: U.S. Employer Health Care Costs Projected to Increase 9 Percent Next Year

Core Insights - The average cost of employer-sponsored health care coverage in the U.S. is projected to increase by 9.0 percent, exceeding $16,000 per employee in 2025 [1] - The increase is attributed to rising medical claims and prescription drug costs, particularly due to specialty drugs and GLP-1 medications [2][3] - Employers are expected to bear the majority of health care costs, with a significant increase in employer costs from 2023 to 2024 [4][5] Health Care Cost Projections - The budgeted health-plan cost for clients is $14,823 per employee in 2024, reflecting a 6.4 percent increase from 2023 [1][4] - Employee premiums are expected to rise by 3.4 percent, while employer costs increased by 6.4 percent [4][5] - Employers subsidize approximately 81 percent of the plan cost, with employees contributing about $4,858 for health care coverage in 2024 [4][6] Industry-Specific Trends - The technology and communications industry has the highest average employer cost increase at 7.4 percent, while the public sector sees the highest employee cost increase at 6.7 percent [7][8] - The health care industry has the lowest average change in employee contributions, with no material change from 2023 [7][8] Factors Influencing Costs - Rising employment levels and wage increases due to inflation are contributing to higher health care costs [2] - Specialty drugs, particularly GLP-1 medications, are driving up prescription drug costs, adding an estimated 1 percent to the overall health care cost increase [2][3] Predictive Analytics and Risk Management - Aon has introduced the Health Risk Analyzer to help employers predict high-cost claimants and manage future health care spending [9][10] - Self-insured plan sponsors face challenges in maintaining stable plan increases, but Aon's tools provide flexibility in funding and risk management [10]