Employer-sponsored insurance is reaching a tipping point. What was once a predictable 2–4% annual increase in employer health spending has given way to double digit growth, driven by surging drug costs, rising utilization across all age groups, and escalating provider rates. For many employers—especially smaller organizations with less margin for error—absorbing these costs is no longer viable. As economic conditions shift and the labor market cools, the balance of power between employers and employees is changing, opening the door to more aggressive cost-control strategies.

In this episode, host Rachel (Rae) Woods is joined by Advisory Board expert Sally Kim to unpack what’s behind the spike in employer health costs—and what employers are doing about it. They walk through the full “menu” of options now on the table, from benefit redesign and navigation tools to network strategy, direct contracting, and alternative funding models. The conversation explores what these moves mean for health plans and providers competing for commercial lives—and why understanding employer behavior is no longer optional.

We’re here to help:

• Ready-to-Use Slides | Market outlook for employer-sponsored insurance
• Listen | Ep. 232: The rise of ICHRAs: Why some employers are turning to the individual market
• Listen | Ep. 286: A Medicare Advantage reset — and what comes next
• Expert Insight | How employers are combating the ‘new normal’ for benefits costs with unconventional measures

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