Four Ways Employers Are Controlling Healthcare Costs in 2026  

Employers have heard it ad nauseum: healthcare costs are going up – and so is the financial strain for their organizations. 2026 is no different, as this year marks a projected 9% increase in healthcare costs. Rising pharmacy spend, especially from specialty drugs and GLP-1s, along with chronic disease trends are partially to blame. But so is the healthcare system.  

So, what’s a well-meaning employer to do? Discover four proven strategies employers are using to control rising healthcare costs in 2026, from data-driven care to integrated primary care models.

1. Using data to proactively manage population health

Large employers are taking a more “activist” role in managing healthcare benefits, according to McKinsey & Company. This shift reflects a deeper understanding of workforce health needs, and the realization that population health management is a critical lever for controlling costs. That’s because claims data provides employers with a clear, accurate picture of how their population uses their healthcare benefits, including where dollars are being spent unnecessarily.  

Population health insights show where people are getting care, the types of services they receive, and how much that care costs. Just as importantly, they expose gaps that drive avoidable downstream expenses — including missed appointments, skipped prescriptions, and lack of visits for chronic disease prevention. These lapses in care often lead to ER visits, hospitalizations, and higher-cost interventions. 

Data puts the power back in the hands of the employer through population health insights. By leveraging their claims data, organizations can:  

• Prioritize the populations and conditions responsible for the greatest share of spend; 

• Design benefits that steer members to lower-cost, higher-quality care;  

• Invest in preventive and primary care services; and  

• Intervene earlier to close care gaps before they escalate into costly events.  

It’s a win-win for both employers and their people.  

2. Reducing fragmentation by moving away from point solutions

Point solution fatigue is real. A survey conducted by Willis Towers Watson revealed more than half of employers (56%) find their employees aren’t actively using or benefiting from specific point solutions. That same survey found low member engagement (41%) due to too many solutions or vendor partners. Point solutions also miss the big picture, focusing on individual conditions while overlooking holistic wellbeing. 

As employer frustration with point solutions grows, many are increasingly focused on managing vendor contracts and auditing services. One way they’re doing this? Reducing the number of offerings. These “disruptive changes” to employer benefits packages signal a broader push toward accountability and benefits ecosystem simplification. 

Instead of layering more vendors onto an already complex healthcare ecosystem, organizations are simplifying their benefits landscape by prioritizing integrated partners that coordinate their people’s care. Having one solution — like an advanced primary care model that integrates multiple types of care — reduces fragmentation for members and excessive spend for employers.  

3. Embracing disruption by investing in alternative health plans 

With vendor scrutiny on the rise and a surplus of point solutions on the chopping block, many employers are turning to something more strategic. Alternative health plan designs — now in place at 41% of organizations — are gaining traction as a proactive approach to improving health outcomes while managing rising costs.  

Alternative health plans are innately designed differently. Built to move away from broad, unmanaged networks and opaque pricing, these models instead embrace intentional, value-driven care. Qualities include curated or alternative provider networks, greater price transparency, and enhanced care navigation. Alternative health plans use incentives and plan design to actively guide members to higher-quality, lower-cost care.  

So, what’s the secret sauce? Many plans place advanced primary care at the center of care delivery, positioning it as the coordinating force that improves outcomes and lowers costs. Looking ahead, nearly half of companies (46%) are planning or considering adopting these capabilities within the next two years. 

4. Prioritizing advanced primary care to prevent downstream costs

Research indicates that a person’s health is in the thousands of little decisions they make before they visit a doctor. More organizations and industries are reckoning with the idea that meaningful impact starts earlier, and along with it, they’re embracing the value of advanced primary care.  

Prevention is the name of the game. Providers in an advanced primary care model help members stay healthier through timely screenings and routine exams. This enables them to address chronic health needs before they escalate into costly hospitalizations, creating sustainable savings by shifting care away from the most expensive settings. 

Beyond preventive medicine, advanced primary care serves as a wellness guide for members. With longer appointment times, proactive outreach from care teams, and digital tools that make healthcare easier, primary care becomes an experience worth having – all while reducing unnecessary downstream utilization for employers. 

Organizations are hungry for credible ideas and long-term value. The research shows that sustainable cost control comes from primary care–led, integrated, and data-driven strategies, not short-term cost-shifting or utilization restrictions. For employers, the path forward is clear: invest in data, embrace disruption, and prioritize prevention. This is how you drive real ROI. 

In search of an integrated care solution that improves your people’s wellbeing and impacts your bottom line? Contact us today.