Zoom in: Instead of simply adding more benefits, employers are adopting more strategic measures:

A significant 63% plan to reallocate or rebalance benefit spending over the next three years, compared to just 8% in the past year.
Nearly three-quarters (73%) intend to address high costs by enhancing the value of current benefits or switching to more cost-effective vendors for health, retirement, and risk benefits.
Tackling high-cost medical conditions (44%) and adopting preferred medical provider networks (37%) are also key tactics.
Priority areas for improvement over the next three years include maximizing value from existing benefits, mental health support, overall health benefits, financial well-being programs, and family support.

By the numbers:

90% of employers identify rising benefit costs as the top issue for 2025.
63% plan to reallocate or rebalance benefit spend in the next three years.
52% are concerned about competition for talent.
44% of employers report challenges in delivering their strategy for health benefits and well-being programs due to costs.
32% cite rising mental health issues as a top concern.

What they're saying: "After a long period of high benefits inflation and in the face of a possibly weakening economy, employers are taking a step back and looking to focus on what drives real value for employees and the business," said Jeff Levin-Scherz, Population Health Leader, North America, Health & Benefits at WTW. "That means targeting support and spending on the benefits that matter most, enabling personalization and helping employees make better decisions.”

SURVEY: Cost Pressures Force U.S. Employers to Rethink Benefit Strategies

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