Health & Wellness
Health and Wellness

Spike in health care costs expected in 2024

The National Survey of Employer-Sponsored Health Plans revealed a 5.2% ($15, 797) increase in the average per-employee cost of employer-sponsored health insurance in 2023.

Another 5.2% increase is projected for 2024, based on the final survey results released Nov. 17. 

The survey, conducted annually by human resources consulting firm Mercer, is one of the largest of its kind and included participation from more than 1,900 respondents in 2023. 

The survey also found that small businesses experienced the steepest hike in employer-sponsored health care costs in 2023, with a 7.8% increase for businesses that had 50 to 499 employees, compared to a 4.6% increase for larger businesses that had 500 or more employees. This pushed per-employee costs for small businesses up to $16,464. 

Prescription drug costs continue to be a driving factor of total health benefit costs, as the survey results webpage states, “Medical breakthroughs have made drugs the fastest-growing component of plan cost for years.”

2023 survey results showed that pharmacy benefit costs rose by 8.4%, compared to 6.4% in 2022. 

Even still, the survey determined that large businesses with 500 or more employees anticipate that employees will shoulder the same amount of total health plan costs as they did in both 2023 and 2022, averaging 22% of total costs.  

Despite the surge in health plan costs, the survey overall concluded that employers will not increase employees’ share of the cost of coverage in 2024, according to a Sept. 7, 2023, preliminary results article on Mercer’s website at https://mercer.com.

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