Employer-sponsored insurance costs rose about 5% in 2024, driven in part by coverage of expensive weight loss medications, according to Mercer's National Survey of Employer-Sponsored Health Plans.
Parts of the survey were originally released earlier this year, with new data published Nov. 20. Mercer surveyed 2,194 employers with at least 50 employees from June 12 to Aug. 16.
Five notes:
1. Employers are spending an average of $16,501 on health insurance per employee in 2024, with a 6% increase expected in 2025.
2. Prescription drug costs are the fastest growing area of benefits spending, rising 7.7% in 2024 and driven in part by the growing use of GLP-1s.
3. Nearly all health plans cover GLP-1s for diabetes, and 44% of employers with 500 or more employees offer coverage for obesity. Among employers with 20,000 or more employees, 64% offer coverage for obesity.
4. Gene and cell therapies are also driving rising drug costs for employers.
5. "GLP-1 medications may turn the tide on the obesity epidemic and positively impact downstream medical costs," Tracy Watts, Mercer's National Leader for US Health Policy, said. "Cost is clearly a concern, and employers are adding authorization requirements to ensure the medications are used by members who will benefit the most."