Advantages brokers who depend on cost-shifting to sort out rising premiums are misdiagnosing the issue, says one main advisor – and the 60% of the workforce no one is speaking about holds the actual reply
Roughly half of huge US employers plan to boost deductibles or enhance different out-of-pocket prices for staff in 2026, in response to a Mercer survey of 711 firms; a reflex response to what Segal has recognized as the steepest projected well being profit value enhance in 15 years.
For Alison Myers, President Company Advantages & Specialty Well being at Venbrook Insurance coverage Companies in Los Angeles, that near-universal intuition is actively making the issue worse.
“Deductibles and copays are small instruments for small issues,” Myers mentioned in an interview with Insurance coverage Enterprise Advantages US. “Once you hit a $500,000 high-cost declare, the deductible and the copays do not matter. A member goes to pay as much as $6,000, and from $6,000 to $500,000 is darkish matter, and there is nothing an employer can do.”
READ MORE: Employers chase value cuts, leaving advantages brokers at a crossroads
The 1% driving 30% of claims
Myers, who has spent greater than 20 years advising giant employers on group well being technique, frames the present value disaster because the product of two forces colliding concurrently: basic healthcare inflation – a health care provider’s go to that after value $100 now prices $150 – and a focus drawback during which roughly 1 % of a coated workforce is answerable for greater than 30 % of complete claims.
Most employers, guided by their brokers, are targeted on the improper finish of that equation. Elevating deductibles reduces plan prices for the 95 % of staff who should not driving these high-cost claims, whereas leaving the underlying driver totally untouched.
“What many brokers do is make the error of pondering that elevating the deductible goes to cut back prices,” Myers mentioned. “And it’ll – however it’s lowering prices for 95% of your workforce that is not making up your high-cost claims. You are hurting an enormous portion of your workforce for a small portion of the inhabitants that is elevating your claims.”
The 20/60/20 mannequin: specializing in the best 60%
Myers makes use of what she calls a 20/60/20 threat focus distribution mannequin to reframe the place dealer consideration and plan design needs to be directed.
 Image a workforce as a bell curve. On the left, the healthiest 20 % (sometimes staff of their mid-to-late twenties) who barely use the plan. On the best, the 20 % of high-cost claimants: most cancers diagnoses, mind aneurysms, untimely births, automobile accidents.
“That’s not threat you’ll be able to management,” Myers mentioned of the right-side cohort. “You can’t management most cancers. You’ll be able to’t management a mind aneurysm.” Plan design guardrails will help handle these claims as soon as they happen, however they can’t stop them.
The center 60 % which Myers calls “rising threat” is the place she says the leverage lies. These are staff whose circumstances are creating however not but catastrophic: manageable persistent points that, with the best engagement and plan design, needn’t graduate into the high-cost tier.
“If we wish to cut back healthcare prices throughout this nation, we have to deal with rising threat in order that that rising threat inhabitants does not shift into the high-cost claims,” she mentioned. “When you can maintain that 60% within the center, we are able to begin getting our arms round our healthcare prices. That is the key sauce.”
Myers trains different brokers on the framework, pushing them towards year-round engagement and proactive plan design fairly than renewal-cycle firefighting.
READ MORE: Do advantages brokers want a brand new playbook on employer well being prices?
The technology cliff compounds the issue
Myers factors to what she calls the “technology cliff” – a gentle enhance within the variety of Medicare-eligible staff persevering with to work full-time, a pattern that has accelerated because the COVID-19 pandemic. Persons are residing longer and dealing longer however not residing more healthy. That shifts the chronic-disease threat pool upward and widens the hole between the left and proper sides of the bell curve.
Larger deductibles, in that context, make issues materially worse. By separating staff from inexpensive preventive care – managing hypertension, sustaining diabetes remedy, maintaining with screenings – cost-shifting measures speed up the very development from rising threat to high-cost claimant that advantages consultants needs to be working to forestall.
GLP-1s: the identical mistake, repeated
The logic extends on to the controversy round glucagon-like peptide-1 (GLP-1) medication. Mercer‘s Nationwide Survey of Employer-Sponsored Well being Plans discovered that six % of huge employers dropped GLP-1 protection for weight reduction in 2026, with one other 5 % planning to drop it in 2027 or actively contemplating doing so.
Myers sees that pattern as a near-identical error to elevating deductibles — short-term value avoidance that does nothing to handle the underlying situation.
“It does not change the truth that the illness or the persistent sickness nonetheless exists,” she mentioned. “Dropping GLP-1s does not change the place the fee goes to indicate up. These medication are lowering ldl cholesterol, they’re lowering diabetes, they’re lowering weight. The short-sightedness of the expense with out permitting the GLP-1s to do what they’re doing means we by no means get to seize that information and see a lower in sort 2 diabetes, a lower in coronary heart circumstances, a lower in ldl cholesterol and statins.”
Reframing advantages and the dealer’s function
The deeper shift Myers is pushing for is cultural. She requires the CFO to be on the desk for giant employer profit conversations, not simply the HR director – as a result of when advantages are mentioned solely as an HR line merchandise, the strategic and monetary dimensions of what she describes as an organization’s second-largest expense stay unaddressed.
“When you may have the CEO defending the imaginative and prescient and the mission, and the CFO defending the underside line, now we’re having a strategic dialog,” she mentioned. “The shift in mindset for employers is that your advantages should not a legal responsibility, they’re an asset. You are really investing within the asset of your folks.”
That mindset shift, Myers says, can be redefining what brokers and advantages advisors really do. The advisor’s job doesn’t finish at open enrollment, it begins there. Reconciling service payments in opposition to payroll deductions (the place she says systematic overcharges are the norm, not the exception), driving worker schooling, directing staff to the best care setting, and holding year-round strategic conversations with the C-suite: these are the actions that separate what Myers calls a holistic advisor from a dealer who negotiates a 20 % renewal down to fifteen and walks away.
“I might save an worker two of their paychecks by guiding them to pressing care as an alternative of the emergency room,” she mentioned. “Take into consideration the facility of that. When it is simply threat safety, you are not having that mindset of the folks, the lives you’ll be able to change.”
The label issues too. Myers challenges the time period “medical insurance” itself, arguing that framing advantages as a promise to pay when one thing goes improper is partly why the US system stays locked in an acute-care fairly than a preventive-care mannequin.
“Healthcare is just not a promise to pay if one thing goes improper,” she mentioned. “It is a promise to be preventive. Calling it insurance coverage virtually diminishes the facility of the system.”
For advantages brokers navigating January renewals in a 12 months when Mercer tasks complete well being profit prices will rise 6.5 % on common in 2026 (the best enhance since 2010) even after deliberate cost-reduction measures, Myers says that the employers reacting with deductible hikes are making use of a single outdated playbook to an issue that calls for a essentially completely different method.
She believes that the brokers who thrive shall be those that get forward of renewals, carry the best folks into the room, and construct packages designed for the 60 % within the center, earlier than these staff turn out to be the fee disaster everyone seems to be making an attempt to keep away from.
