In 2024, the cost of employer-sponsored health insurance for families has increased by 7% annually, reaching an average of $25,572. This is the second consecutive year of a 7% increase, reflecting a broader trend of rising health care costs that have gone up by 24% over the past five years. Despite inflationary pressures and wage growth, workers are still contributing an average of $6,296 per year towards these premiums. The tight labor market has limited employers' ability to shift costs onto employees, who are already dealing with increasing health care expenses.
Large firms face the challenge of incorporating new treatments into their benefit plans, with nearly half recognizing the importance of covering GLP-1 drugs for employee satisfaction. However, only a small fraction currently provide this coverage due to concerns about the impact on overall health plan expenditures. Less than 20% of large employers with at least 200 workers offer coverage for GLP-1 drugs, while 52% do not cover them and 31% are uncertain about their plans. Among the largest firms, 28% provide this benefit, but nearly two-thirds still do not. Even for those that do provide coverage, there may be conditions that hinder access, such as consultations with health professionals or participation in weight-loss programs.
Additionally, large employers are also navigating the complexities of family-building benefits. Approximately 27% of large firms offer in-vitro fertilization (IVF) coverage, while 26% provide artificial insemination benefits. Fertility medications are covered by 37% of employers, but only 12% extend coverage to egg or sperm freezing. Many firms are uncertain about the specifics of their coverage, indicating a need for clearer communication regarding available health benefits.
Mental health and substance abuse services are another area of concern for large employers. About a quarter of these firms report that their networks for mental health services are narrow, compared to only 10% who describe their general networks in the same way. To address growing mental health needs, nearly half of large employers have increased the availability of mental health counseling resources through employee assistance programs or partnerships with third-party vendors.
Large firms are also implementing strategies to manage costs associated with spousal coverage. Some impose higher premiums or restrict coverage if the spouse has access to insurance from another source. Others incentivize employees to enroll in a spouse's plan or to opt out of the company's health benefits altogether, reflecting a trend towards more strategic management of health care costs.
As employer-sponsored health insurance continues to evolve, the interplay between rising premiums, employee contributions, and the integration of new health benefits remains a critical focus for large firms. Innovative solutions and a reevaluation of existing benefit structures are necessary to ensure that employees receive the support they need while managing the financial implications for employers.