Healthcare spending is climbing every year. According to projections, businesses will pay an average of 9% more for their employees’ medical benefits in 2025, up from the 6.4% increase in 2024. Inflation plays a part in this trend, as does the growing burden of treating chronic conditions. Meanwhile, employers are under increased pressure to offer high-quality benefits that help attract and retain top talent.
In response, business owners and HR leaders are adopting several key strategies to meet the expectations of their workforce and prospective talent while controlling costs. These approaches center on affordable, accessible and efficient care that makes it easier for employees to manage their health. That’s because healthier populations generally need less, and lower-cost, care. However, when it isn’t affordable or easy, people often forego or delay necessary healthcare services. This can lead to more complex and expensive interventions down the line.
Here are three things Arizona businesses are prioritizing in their benefit plan design that improve care quality and drive better cost control:
- Convenient routine and preventive care. One of the most effective ways to control healthcare spending is to prevent or treat illness before it becomes chronic and more costly. Yet, today’s employees are busier than ever and expect convenience when it comes to their health. When evaluating their workplace benefit plans’ primary care options, leaders should consider ease of use (like virtual visits for common illnesses or digital behavioral health support) as well as affordability.
From seeking an annual physical to managing hypertension, putting flexible, low-cost options in employees’ hands can encourage higher adoption of these types of services. An uptick in their utilization can result in lower emergency and in-patient utilization, reducing healthcare expenses for both employers and staff members.
- Wrap-around, whole-person wellness support. As the cost of chronic conditions continues to burden the healthcare system, employers have realized that treatment of these diseases shouldn’t start and end with pharmacologic management. Many workplaces are adopting benefit plans that offer multidisciplinary and holistic behavior modification programs that address root-cause elements of conditions like diabetes and obesity. These factors may include diet, exercise and nutrition.
So, many leading workplaces are choosing to partner with a health insurer that offers member-centric lifestyle programming to help their employees’ health improve long-term while driving optimal cost management.
- High-value, coordinated care. In the U.S., traditional fee-for-service models have rewarded volume (the quantity of healthcare services provided), not value (outcomes demonstrating better health). Many workplaces realize the pitfall of this approach and have elected to work with health insurance companies that build efficient, high-value care into their business model.For example, Banner|Aetna is a joint venture between Aetna (a leading national insurer) and Banner Health (the largest health system in Arizona). The “payvider” model means that both the payer and provider entities are aligned in their incentives to both reduce costs and help people get and stay well. Flipping the script on this traditionally adversarial relationship between a health insurer and a provider puts each member at the center of care. As a result, employees have a better experience and see better outcomes.
Sustainable Health Care Is Good for Business
Projections show that healthcare spending will continue to rise, making it critical for businesses and HR leaders to implement cost-mitigating strategies to protect their bottom line. All the while, forward-thinking employers realize that even amidst rising costs, their organizations must continue to offer top-tier benefits to meet employees’ needs and attract new hires.
Fortunately, many Arizona employers are implementing strategies like these to maintain a healthier workforce, enhance productivity and control spending. Investing in employee health is more than a smart business move — it’s the foundation for a resilient, thriving workforce and a stronger future.
 Dan Keller is chief financial officer at Banner|Aetna. |
