Key strategies to get ahead of healthcare cost increases

Nearly every analyst today projects that healthcare costs will be down in Q1 of 2020 and historically down in Q2 of 2020, but there is clearly uncertainty in the cost trend moving forward. The projections below depict three possible outcomes for how employers should think about their healthcare budgeting over the next couple years.

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Scenario 1

Initial dip and subsequent bulge are roughly equal in size

Scenario 2

Initial dip is larger than subsequent bulge

Scenario 3

Subsequent bulge is larger than dip and new normal trend is set

Based on the level of disruption that has already occurred (and is likely to continue as re-openings occur and potentially retract), this third scenario should be the new base case against which planning and budgeting should be considered. This is an unprecedented disruption and the expanded future costs are likely to be larger than the initial decrease currently being realized.

Employers must consider strategies to directly address impacts on healthcare cost to mitigate long-term effects of the pandemic.

Check out our free e-book—5 Strategies to Get Ahead of Healthcare Cost Increases—to get a head start on containing your healthcare benefits costs.