Bruneau: How Employers Can Reduce Healthcare Costs

Employer-sponsored healthcare costs continue to spiral upward, but a growing movement suggests that companies have more power than they realize to bring those expenses under control.

A 2024 investigation by The New York Times found that employer health plan payments are often double what providers actually receive for services, with insurers and other intermediaries capturing the difference. That staggering markup means that for every dollar an employer spends on healthcare, a significant portion never reaches the doctors and hospitals providing the care.

The findings have reignited calls for employers to take a more active role in how their healthcare dollars are spent. Rather than simply accepting the plans offered by traditional insurers, a growing number of companies are exploring alternative models — from direct contracting with healthcare providers to reference-based pricing that ties reimbursement to actual costs rather than inflated chargemaster rates.

Some employers have also found success with transparency tools that give employees better visibility into healthcare pricing before they seek care. When workers can compare costs across providers, they often choose lower-cost, high-quality options, generating savings for both themselves and their employers.

The broader trend reflects a shift in how businesses think about healthcare — not as a fixed cost that inevitably rises every year, but as an area where strategic intervention can produce meaningful savings without sacrificing quality.

What This Means For You: If your employer provides health insurance, these cost-reduction efforts could directly benefit you — through lower premiums, better coverage, or both. And if you're a business owner, the data suggests that simply accepting your insurer's pricing is leaving money on the table. Asking questions about where your healthcare dollars actually go is the first step toward change.