Employer health costs expected to increase next year, healthcare consultants say

U.S. employers are bracing for the largest increase in health insurance costs in a decade next year, according to forecasts from healthcare consultants, but workers may be somewhat spared this time around in a tight labor market (Source: “US employers to see biggest healthcare cost jump in a decade in 2024,” Reuters, Sept. 20).

Benefit consultants from Mercer, Aon and Willis Towers Watson see employer healthcare costs jumping 5.4% to 8.5% in 2024, due to medical inflation, soaring demand for costly weight-loss drugs and wider availability of high-priced gene therapies.

A survey conducted by Mercer found over two-thirds of employers either do not plan to shift any cost increase to their staff or will pass on less than the expected rise in 2024.

U.S. consumer prices accelerated 3.7% in the 12 months through August, down from a peak of 9.1% in June last year. However, medical cost increases usually lag general inflation as contracts between insurers and hospitals for the prices of procedures are signed months or even a year in advance.