The Blame Lands on the Wrong Desk
Premiums go up. Employees get angry. And HR absorbs the hit. That's the cycle, and it's getting worse. SHRM and the International Foundation of Employee Benefit Plans project a 10% healthcare cost increase for 2026, up from 8% the year before. HR professionals didn't cause that. But they're the ones explaining it.
The real drivers aren't inside your building. Catastrophic claims, specialty drugs, and GLP-1 medications are doing the heavy lifting on cost growth, according to that same IFEBP data. No benefits team controls any of that.
Yet the accountability somehow lands on the team managing open enrollment. That accountability gap is a retention problem. When HR directors spend renewal season defending decisions made by actuaries and carrier networks, something is broken. Not in the benefits. In how the whole thing is structured and communicated.
Plan Design Changes Help. Inaction Has a Price Tag.
Here's a number worth knowing. Brown and Brown's 2026 healthcare cost outlook found that without any plan design changes, employers would have faced a 12% increase. Active interventions brought that down to 10%. That two-point gap is not small.
On a $2 million premium spend, that's $40,000. On $10 million, it's $200,000. Bring that data to your CFO before renewal, not during it. The conversation shifts from "here's what things cost" to "here's what we did to reduce it."
But plan design changes aren't free either. They have winners and losers. Moving employees from a group plan to a stipend arrangement sounds clean on a spreadsheet. Some employees come out ahead. Others, especially those with dependents or chronic conditions, can lose real ground.
Transitions need analysis and communication, not just cost math. Skipping that step is how HR ends up back at square one with angry emails from different employees.
Prescription Drug Costs Are a Flashpoint You Can't Ignore
GLP-1s alone are reshaping the actuarial assumptions behind most mid-market plans. But the drug cost problem runs deeper than any single drug class. PBM rebate pass-through language is murkier than it looks, even in contracts that say "100% pass-through."
GPO arrangements sit upstream of the PBM. Rebates get netted before they ever reach the pass-through calculation. The Lark Health summary of 2026 plan sponsor challenges describes this as one of the most complicated cost environments plan sponsors have faced yet.
The FTC has flagged PBM pricing practices as a federal concern and a task force is active. This space is moving. HR doesn't need to become a PBM expert. But "100% pass-through" isn't a complete answer. Know that before your next carrier meeting.
Your Employees Don't Know What You're Spending on Them
Some employers cover 90% or more of premiums and still get angry emails every November. That's not a benefits problem. That's a communication problem.
Employees see their paycheck deduction. They don't see the $800 a month the company is spending on their behalf. An employee who sees that their employer is contributing $9,600 a year to their health coverage reads an open enrollment email differently than one who just sees a deduction going up $15 a month.
Total compensation statements are one of the most underused tools in benefits. They're low cost. They make the invisible visible.
The Orange County Government's 2024 performance audit of its HR department flagged a long-standing failure to incentivize employees toward lower-cost plan options. That's a communication and design failure, not a funding failure. Mid-market employers make the same mistake constantly. They invest in the benefit and skip the explanation.
What HR Can Actually Control
You can't set the cost of a GLP-1 drug. You can't control catastrophic claims. You can't negotiate carrier contracts single-handedly. So what can you actually control?
You can control the narrative inside your organization. You can bring cost data to leadership before renewal season. You can push for total comp statements.
You can demand clear answers on rebate pass-through before signing a PBM contract. You can model the winners and losers before changing plan design, not after. The angry emails aren't going away. But they don't have to land on HR as if HR is the problem. That starts with changing the framing inside your building before the next renewal cycle hits.