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High medical costs are inevitable. But they’re also predictable and manageable with the right data and the right partner.

The challenge for employers is understanding the needs of their employees, in order to anticipate, address and manage high medical costs.

Consider the following:

• Multimillion-dollar claims are on the rise, due in large part to expensive specialty drugs and a rise in people living with chronic conditions.
• Companies spent $2.5 billion to treat employees’ diabetes, hypertension, mental health/substance use disorders, asthma, and back disorders between July 2018 and July 2019. More than 60% of workers have at least one of these chronic conditions.
• Five chronic diseases or risk factors—high blood pressure, diabetes, smoking, physical inactivity, and obesity—cost U.S. employers $36.4 billion a year. because of employees missing days of work.
• Around 4% of the population uses specialty drugs, but they account for 65% of total drug costs and 19% of total health care costs, according to Cigna’s 2022 National Trend Report.

These kinds of medical cost concerns can greatly impact your company’s bottom line and profitability. They can also take an immense physical, emotional, and financial toll on your employees, which impacts their productivity and hinders your ability to grow. The Integrated Benefits Institute estimates that the cost of poor worker health amounts to 61 cents of each dollar. employers spend on health benefits.

Do you know what your employees need today to get and stay healthy? Do you know how to help those with chronic conditions get the best care? Your employees are diverse and their health needs are, too. But companies that implement benefit strategies based on their employees’ specific health conditions can help improve the health and well-being of those employees – your greatest asset.

It comes down to seeing health benefits as a long-term investment in your people, not merely as an expense.

An Investment, Not a Cost

Providing more meaningful health benefits doesn’t always mean spending more money; after all, a costly specialty drug could, for some patients, reduce the total cost of care over the long term while improving that patient’s health, well-being, and productivity.

How is the high up-front cost amortized over time? How do decisions you make today drive the total cost of care? To answer these questions, you must anticipate and manage the risk to your company and employees.

Meet Employees Where They Are

To anticipate medical costs, you need to understand the composition and diverse needs of your employee base. Many factors can have an impact on claim costs. Some, such as age, current health conditions, and health care utilization, are more obvious. Others, many of which can be related to social determinants of health, are less so. These may include:

• Race and ethnicity
• Health goals
• Location (including access to primary care and healthful food)
• Gender
• Income
• Education
• Life events
• Caregiving responsibilities
• Role in a company
• Motivations

The pandemic has made clear just how important it is to consider all the factors that contribute to a person’s health. From its disproportionate impact on people of color to the strain on caregivers, the pandemic has taught us all that supporting employee health is a comprehensive, iterative endeavor.

To capture the nuance, consider the humans behind the data. Engage with and listen to employees to understand what they truly require to be satisfied and productive. By understanding what employees need, designing benefits to meet those needs, and targeting communications by workforce, you engage employees where they are. You can improve productivity, enhance employee health and happiness, and bend the cost curve.