How Can We Reduce Our Group Health Insurance Costs?

July 31, 2025

Strategies to Reduce Healthcare Costs Without Cutting Benefits

Rising healthcare costs are a concern for nearly every employer. But cutting coverage or shifting more cost to employees isn’t the only option. There are smart, strategic ways to manage healthcare spending while keeping your benefits competitive and valuable.

Evaluate Plan Design

Consider offering multiple plan options, including a High Deductible Health Plan (HDHP) paired with an HSA. This gives employees more choice and may reduce your overall premium costs.

Use a Level-Funded or Self-Funded Plan

These plans allow employers to pay for claims as they happen—potentially saving money in low-claim years. They also provide valuable claims data that can inform future decisions.

Encourage Preventive Care

Preventive services are typically covered at no cost under ACA-compliant plans. Promote annual check-ups, screenings, and vaccinations to reduce costs related to avoidable chronic conditions down the line.

Offer Telehealth Services

Telehealth is a convenient, low-cost alternative to in-person visits for minor illnesses and mental health support. Encouraging its use can reduce ER and urgent care claims.

Review Pharmacy Benefits

Prescription drug costs are one of the fastest-growing parts of healthcare spend. Work with your broker to ensure your plan promotes generic medications and uses a competitive pharmacy benefit manager (PBM).

Educate Employees

Helping employees understand how their plan works—what an ER visit costs vs. urgent care, for example—empowers them to make cost-conscious decisions.

You don’t have to cut benefits to control costs. By taking a proactive, data-informed approach, you can create a sustainable, affordable plan that still supports your employees’ health and wellbeing.