About 165 million Americans get their health insurance through work, and yet most don’t spend much time considering what their employer is offering in the way of benefits and what it will cost.
In fact, employees only spent about 45 minutes a year, on average, deciding which benefit options suit them best, a report from Aon found.
Open enrollment season, which typically runs through early December, is an opportunity to take a closer look at what’s at stake.
And, for starters, costs are going way up.
post-pandemic high, according to WTW, a consulting firm formerly known as Willis Towers Watson. U.S. employers project their health-care costs will increase by 7.7% in 2025, compared with 6.9% in 2024 and 6.5% in 2023, the firm said.
Because of higher costs, employers are considering new ways to adjust their plan offerings, WTW found.
To that point, 52% of companies said they plan to implement programs that will reduce total costs, and just as many intend to steer to lower-cost providers and sites of care, which may mean a narrower network of doctors from which to choose.
Currently, employers subsidize about 81% of health-care plan costs, on average, while employees pay the remainder, according to professional services firm Aon.
However, some of the higher costs will also inevitably get passed on to employees.
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Roughly one-third, or 34%, of employers expect to shift some of the expense to employees through higher premiums or by raising co-pays on high-deductible health plans in the year ahead, the WTW report found.
The cost per employee is expected to jump 5.8% on average in 2025, marking the third consecutive year of health benefit cost increases above 5%, after a decade of averaging only around 3%, according to a separate report by consulting firm Mercer.
“These are changes employees will feel,” said Beth Umland, Mercer’s research director of health and benefits.
For workers, health-care expenses are already high: Family premiums for employer-sponsored health insurance rose 7% this year to an average of $25,572, KFF’s 2024 benchmark employer health survey found. Workers are responsible for more than $6,200 of that amount, while employers pick up the rest.
“With cost increases reaching a post-pandemic high, companies are concerned about the burden it’s putting on their workforces, especially since it affects decisions about insurance coverage and care,” Tim Stawicki, WTW’s chief actuary of health and benefits, said in a statement.
health savings account, or HSA, which can help with additional health-care costs.
To be able to use an HSA, you must have an eligible high-deductible health plan. The IRS defines “high-deductible” as at least $1,650 for self-only plans or $3,300 for family coverage for 2025.
The IRS also determines the maximum allowed contribution each year: The new HSA contribution limit for 2025 will be $4,300 for individuals, up from $4,150 in 2024, and $8,550 for families, up from $8,300 in 2024. Employees 55 or older can make an additional $1,000 catch-up contribution over the IRS annual limits.
HSA contributions then grow on a tax-free basis, and the funds can cover out-of-pocket expenses, including doctor visits and prescription drugs, including expensive weight-loss medications.
As costs continue to go up, HSAs are a key safety net for managing these out-of-pocket expenses, WTW’s Ihrke said. Any money you don’t use can be rolled over year to year.
“Make sure you are considering how to put some money into that savings account so you can use it to pay for a doctor’s bill or save it for future years,” Ihrke explained.
