Rising healthcare costs for employers projected to reach historic levels in 2027.

Employers are bracing for the steepest healthcare cost increase in more than two decades. Per-employee costs are projected to rise 11% next year before any plan changes, and roughly 8% after employers make cuts, according to research released by Marsh, the highest final number since 2003. 

Business Group on Health puts the 2027 median trend at 9.2%, part of a run that will push cumulative healthcare cost growth to 76% between 2018 and 2027, about double the rate of general inflation over the same period.

This shouldn’t be “the new normal.” What specifically can employers look at to drive down these cost increases? 

What's actually driving the rising healthcare costs

Ask employers what worries them most about their trend, and the answer is specific. In the National Alliance of Healthcare Purchaser Coalitions' 2026 Pulse of the Purchaser survey, employers named the following as top threats to their healthcare costs: 

• Drug prices (77%)
• High-cost claims (75%)
• Hospital prices (68%)

These threats are related. A small number of members can drive a high proportion of healthcare costs. For example, the Federal Trade Commission reported in 2024 that specialty drugs account for only 2% of total prescription volume but roughly 40-50% of pharmacy dispensing revenue. On top of that, specialty drugs and infusion therapies are among the fastest-growing segments of healthcare.

A deep dive into one cost driver

Pharmacy now accounts for 25% of total healthcare spending and is projected to grow another 12% in 2026, per Business Group on Health. That’s driven by:

• GLP-1 utilization.
• Expanding specialty drugs.
• New cell and gene therapies coming to market. 

Inside that pharmacy line sits specialty infusion therapy, which is the provider-administered drugs that treat cancer, multiple sclerosis, rheumatoid arthritis, Crohn's disease, and other complex conditions. 

Employers scrutinizing pharmacy spend alone might be missing out on the specialty drugs that sit within their medical claims, in the form of a bundled claim within a single J code. 

The reason these costs are increasing isn't the drugs themselves. It's how they're billed. Hospital outpatient departments and provider clinics buy these drugs at acquisition cost, mark them up by as much as 400% under a practice known as buy-and-bill, then submit a single bundled claim that makes it hard to distinguish the cost of the drug from the markup of it. 

The same Ocrevus infusion that can cost roughly $89,000 at a hospital can cost about $39,000 billed at true acquisition cost, a difference that has nothing to do with the drug and everything to do with who's marking it up.

The market dynamics of a member’s location can also influence costs. A member in a market with one dominant hospital system and less pricing competition can cost an employer dramatically more money in the markup of the medications they need. 

Disrupting the status quo takes more than a half-measure

The appetite for change is real. Nearly 3 in 5 employers (58%) plan to replace underperforming vendors by 2027, according to Business Group on Health. Both stats are indicators that organizations are ready to make a change, but when faced with historic cost increases, they also need to evolve their current approach. 

For example, organizations looking to cut specialty infusion therapy costs have historically looked to divert them to a lower-cost site of care, moving members from a hospital to a home infusion provider or an ambulatory infusion center. The instinct makes sense. Hospitals carry the highest overhead of the three settings.

The problem is that addressing site of care alone doesn’t address what a provider actually pays to acquire the drug or the billing model. A home infusion provider has the same buy-and-bill flexibility a hospital does and is just as capable of marking up a drug from its original cost, and that’s often the biggest driver of cost increases. 

4 steps you can take right now

Waiting for renewal season isn't the only option. Some of the most useful next steps simply require you to start asking questions. 

• Find out which cost category is actually driving your trend. Ask your consultant to break your trend down by category before you try to fix anything.
• Ask for the actual claim-level encounter data. A repricing analysis built on your own paid claims, encounter by encounter, tells you where the money is actually going. If the answer comes back as "we can't share that," or the numbers don't match what you know you paid, that's useful information on its own.
• Confirm who actually owns specialty infusion within your broker or consultant team. Pharmacy consultants are typically built around retail pharmacy and PBM contracts. Medical-side infusion spend often falls into the gap between the pharmacy team and the medical team, with no one treating it as its own category. Ask directly whether someone on your account team is looking at infusion the way they look at your PBM.
• Check where your highest-cost claims care is occuring. Prices for the same drug can vary widely by metro area. If your highest-cost claimants cluster around a single hospital system, that's worth understanding before renewal
  
  Your organization can cut specialty infusion spend by 60% or more. Click to find out how.