Episode 2 Show Notes: The Benefits Cost Crisis Why Your Health Plan Keeps Getting More Expensive (And What You Can Actually Do About It) Episode Summary Health plan renewals are climbing faster than almost any other cost in the business, and many business owners and HR leaders are quietly wondering whether their organization can keep offering coverage at all. In this episode, Don breaks down what’s really driving the increases, from specialty drugs and GLP-1 weight-loss medications to a pricing system almost nobody can see into, and walks through the practical options employers have to take back control before they consider cutting benefits. Free Download: The Medical Benefits Renewal Checklist Whether you’re reviewing your current health plan or getting ready for your next renewal, this checklist walks you step by step through what to ask, what to look for, and which options to compare, so you head into the conversation with confidence instead of just reacting to a number. Get the checklist: https://theemployerbriefacademy.com Where the Money Is Going According to the KFF Employer Health Benefits Survey, the average annual premium for family coverage reached $26,993 in 2025, up 6% from the year before. Workers paid about $6,850 of that; employers paid the rest.Pharmacy is one of the fastest-growing slices of the plan, driven largely by specialty drugs and GLP-1s.Most employers only see the renewal number. Few see what’s driving it. Pharmacy, Specialty Drugs, and GLP-1s Specialty drugs are a small share of prescriptions but a large share of pharmacy spend, often around half.GLP-1s: A 2026 Business Group on Health survey found 67% of large employers cover GLP-1s for weight loss, but only about 72% of those plan to continue in 2027. Nearly 8 in 10 say GLP-1s are driving cost increases.Watch the headlines: Novo Nordisk announced a lower Wegovy list price (about $675) starting January 2027, but employers already pay a net price after rebates. A lower list price doesn’t automatically mean lower plan costs.Common GLP-1 management tools: prior authorization with clinical criteria, required lifestyle programs, approved-prescriber limits, cost-sharing tiers, or excluding weight-loss coverage. Pooling and the Question Nobody Asks Pooling: combining many people’s health risks so the premiums of the healthy many cover the costs of the unlucky few. The bigger the pool, the more stable the costs.Small groups, large-claim pooling points, PEO master plans, and the ACA marketplace all rely on pooling.Questions to ask before joining any pool:Is my renewal based on the pool’s claims, my claims, or a blend?Above what dollar amount are large claims shared across the pool?How has the pool’s renewal history looked over the last 3–5 years?What happens to my rates, and my claims data, if I leave?Who is the plan sponsor, and what does that mean for my control and responsibilities?Who pays the claims when the pool has a bad year?Plan sponsor: the organization that sets up and maintains the plan and carries the legal responsibility for it. In your own group plan, that’s you. In a PEO master plan, it’s typically the PEO. Why capital matters: a pool that carries its own risk needs reserves to absorb bad years, keep renewals stable, and pay claims that arrive after the fact. A pool is only as strong as the money behind it. ICHRA: The Fastest-Growing Option You’ve Never Heard Of ICHRA (Individual Coverage Health Reimbursement Arrangement): the employer gives a tax-free monthly allowance, and employees buy their own individual coverage.HRA Council data: more than 500,000 people covered and 20,000+ businesses offering ICHRA or QSEHRA as of early 2026, with adoption up about 53%.The fastest growth is among larger employers. Adoption among employers with 50+ employees more than doubled year over year.Keep it in perspective: that’s still well under 1% of the 150+ million Americans with employer coverage.Advantages: predictable employer cost, no participation minimums, employee choice, portable coverage, and a good fit for multi-state or remote teams.Disadvantages: depends on the strength of your local individual market, more work for employees, often narrower networks, and employees with an affordable ICHRA lose marketplace subsidies. Steering Care: Telemedicine, Urgent Care, and the ER UnitedHealthcare’s 2025 data (median allowed amounts, network providers): Care setting Average cost Emergency room ~$2,750 Urgent care ~$195 Primary care office visit ~$180 Retail / walk-in clinic ~$105 Virtual care (telemedicine) $60 or less Before You Drop Coverage Shop the market or join a PEO for large-group pricing and pooling.Redesign the plan: HDHP with HSA, narrow networks, base-plus-buy-up options.Change your contribution: employee-only coverage or a fixed dollar amount.Replace, don’t remove: ICHRA, QSEHRA, or a stipend.If you do drop coverage: know your ACA status (50+ full-time equivalents), meet notice requirements, help employees transition, and keep low-cost benefits like dental, vision, and EAP. Key Takeaways Your renewal is a symptom. Ask for the data on what’s driving it, especially pharmacy.Your PBM contract may be your biggest lever. Price, mix, channel, and behavior all matter.Know the rules of any pool before you join. How you’re rated matters as much as the size of the pool.You have more options than you think. Level funding, reference-based pricing, captives, and ICHRA are no longer just for big companies.Dropping coverage should be the last step, not the first. Most employers have three or four options to try first. Resources & Sources The Medical Benefits Renewal Checklist (free download): [download link]KFF 2025 Employer Health Benefits Survey: kff.orgBusiness Group on Health, 2026 GLP-1 Survey: businessgrouphealth.orgEpstein Becker Green, 2026 PBM Reform Summary: ebglaw.comHRA Council ICHRA growth data (via Take Command): takecommandhealth.comUnitedHealthcare care setting cost comparison: uhc.comWegovy list price analysis: employercoverage.substack.com RECAP Website: https://theemployerbriefacademy.comEpisodes Release Dates: Weekly, Every WednesdayNewsletter Sign Up, Book Speaking Engagements or Consultations, and Contact Me: https://theemployerbriefacademy.com Book a Consultation: https://calendly.com/don-hicks-hr-business-consulting/don-hicks-hr-business-consultingContact Me Directly: https://calendly.com/don-hicks-hr-business-consulting/don-hicks-hr-business-consultingBook a Speaking Engagement Consultation: https://calendly.com/don-hicks-hr-business-consulting/consultation-w-don-hicks-the-employer-brief-ac-clone