Key Health Trends Shaping Employer-Sponsored Benefits in 2025

A Deep Dive into Emerging Healthcare Challenges and Innovative Solutions for Employers and Insurers

As we step into 2025, a comprehensive study by Mercer Marsh Benefits (MMB) has illuminated the most pressing healthcare trends affecting employer-sponsored benefits across the globe.

Although many of the findings echo familiar concerns, there is a marked shift in how employers and insurers are addressing these issues.

In this article, we’ll explore the three primary conclusions from MMB’s 2025 healthcare trends report, shedding light on the intensifying health risks, emerging cost-control practices, and the evolving nature of medical coverage.

1. Intensifying Health Risks: A Rising Challenge for Employers and Insurers

The incidence of severe health conditions, particularly among younger populations, is on the rise, posing a significant challenge for employers and insurers alike.

According to the MMB survey, 82% of insurers have reported an increase in cancer treatment claims over the past five years, especially for individuals under the age of 50.

This alarming trend signals a broader issue in the healthcare system—major health risks are becoming more common, affecting a larger segment of the workforce.

Over the last decade, medical conditions that drive costs have remained largely unchanged, with non-communicable diseases such as cardiovascular conditions, respiratory illnesses, and cancer continuing to be primary drivers of healthcare costs.

However, the severity and frequency of these claims are escalating, leading to greater financial burdens on both insurers and employers.

The Rising Burden of Cancer Claims

While groundbreaking treatments are being developed for conditions like obesity, which have a significant impact on cardiovascular and metabolic health, they are often prohibitively expensive.

These treatments are frequently not included in standard health insurance plans, exacerbating the financial strain on individuals and employers alike.

Additionally, younger workers are now experiencing an increase in catastrophic health claims, which can quickly push them to the limits of their lifetime coverage thresholds.

As a result, employers and insurers must rethink their strategies for managing health risks.

This includes evaluating the impact of high-cost claims on the sustainability of benefit plans and exploring ways to provide more comprehensive coverage without compromising affordability.

Adapting to Evolving Risks

Employers should focus on reviewing their health plans’ coverage limits and considering the long-term impact of emerging health conditions, particularly within the workforce.

By keeping a close eye on the increasing frequency of cancer and cardiovascular diseases, employers can develop more proactive strategies to mitigate these health risks and maintain the financial health of their benefit plans.

This might include expanding coverage to incorporate more comprehensive care options and ensuring that employees have access to critical treatments.

2. Emerging Cost Control Practices: Innovations in Healthcare Management

The MMB study reveals that 61% of insurers are adopting pre-authorization measures to assess the necessity and cost-effectiveness of medical procedures and treatments.

Furthermore, 58% of insurers are utilizing negotiated bundled pricing for specific procedures to help control costs.

While healthcare costs are undoubtedly rising, they are not an insurmountable challenge. Employers can manage these escalating expenses by taking a proactive approach to cost containment.

This involves thoroughly understanding their benefit plans at local, national, and global levels, identifying areas where costs can be reduced, and implementing innovative solutions.

Innovative Approaches to Cost Containment

Pre-authorization and bundled pricing are just the beginning.

Employers can explore alternative financing options, such as self-insurance, to provide more flexibility in managing healthcare costs.

Additionally, the integration of digital health technologies, including virtual care support and artificial intelligence (AI), presents an exciting opportunity to enhance healthcare delivery while managing costs more effectively.

Virtual healthcare platforms, which allow employees to receive consultations and treatment remotely, are becoming increasingly popular.

These platforms can help reduce administrative costs, streamline healthcare processes, and provide employees with more convenient access to care.

AI and Healthcare: The Future of Risk Management

By harnessing AI to analyze claims data and predict future healthcare needs, employers and insurers can better understand employee health risks and take proactive steps to manage those risks before they become costly problems.

AI can also improve the efficiency of claims processing and help insurers offer more personalized care to members.

3. Narrow Medical Coverage: Bridging the Gaps in Employee Health Needs

Despite advances in healthcare, there continues to be a significant gap between the health services that insurers typically cover and the needs of today’s diverse workforce.

According to the MMB survey, 39% of workers expressed interest in virtual mental health support, such as AI-powered chat services for anxiety, depression, or relationship issues.

Yet, only 15% of insurers currently provide this service as part of their standard coverage.

This discrepancy highlights a growing need for more inclusive healthcare plans that address the full spectrum of employee health needs.

From mental health support to services for neurodivergent individuals and those navigating menopause, employees are demanding more comprehensive care options.

The inadequacy of coverage is further exacerbated by inflation, which can erode the value of benefit plans over time.

The Demand for Inclusive Healthcare Plans

As employees increasingly prioritize mental health support, including counseling services and therapy, employers must consider how their benefit plans can adapt to meet these needs.

For instance, employers should review how plans allocate funds for mental health services—whether through per-session fees or annual caps—and ensure that employees have access to the resources they require.

Employers should also recognize the growing demand for healthcare services that support employees in various stages of life, such as those experiencing menopause or those with neurodivergent conditions.

As the workforce becomes more diverse, employers will need to make their healthcare offerings more inclusive, ensuring that all employees have access to the support they need to maintain their health and well-being.

Developing a Comprehensive Risk Mitigation and Cost Containment Strategy

The Mercer Marsh Benefits 2025 healthcare trends report underscores the importance of developing a robust, regularly reviewed risk mitigation and cost containment strategy.

Employers should create a governance model that offers full visibility into their benefits plans, using technology to keep them up-to-date and sustainable.

Engaging in open dialogue with stakeholders—such as internal risk managers, finance teams, and insurers—will help employers better understand their workforce’s health risks and tailor their benefits packages accordingly.

Additionally, employers should focus on the long-term success of their benefits strategy by incorporating metrics and feedback loops to measure the impact of their investments in employee health.

This might include tracking improvements in employee health outcomes, productivity, absenteeism, and claims costs.

By connecting benefits strategies to return-on-investment (ROI) metrics, employers can ensure that their plans are sustainable and capable of adapting to future healthcare challenges.

Conclusion: The Future of Employer-Sponsored Healthcare Benefits

By addressing the intensifying health risks, embracing innovative cost-control practices, and expanding coverage to meet the diverse needs of employees, employers can create healthcare benefit plans that are both affordable and comprehensive.

The key to success lies in developing a strategic, data-driven approach to healthcare benefits, one that balances cost containment with coverage adequacy.

By staying ahead of emerging trends and leveraging new technologies, employers can ensure that they are providing the best possible care for their employees while maintaining the financial sustainability of their benefit plans.