A recent Mercer survey reveals that 51% of U.S. employers with 500+ employees plan to reduce health benefits in 2026. This marks a rise from 45% in 2025 and stems largely from skyrocketing costs linked to specialty and weight-loss medications, particularly GLP‑1 drugs like Wegovy and Zepbound. Prescription drug spending surged 8% last year, with overall health benefit costs expected to increase by about 5.8% this year. As a result, employers are exploring strategies such as raising deductibles and out-of-pocket limits to shift more costs to employees. They’re also re-examining Pharmacy Benefit Manager (PBM) relationships — 34% are considering alternative PBMs, and 40% exploring outcome- or acquisition-based pricing arrangements. Notably, large buyers like CalPERS are changing PBMs to increase transparency. This shift highlights employers’ efforts to balance the short-term benefits of covering innovative therapies against the long-term financial strain these treatments impose on their benefits programs.
U.S. employers trimming health benefits
