Mercer Survey Confirms Employer Healthcare Struggles
A new survey and study from consulting firm Mercer adds to the growing worry about the status of employer coverage. It says employers are likely to see healthcare costs increase significantly next year.
Mercer polled more than 1,700 employers and found that total health benefit costs per employee are expected to rise by an average of 6.5% in 2026 after cost management and 9% before such measures. This 9% gross trend is consistent with the 8% to 9% seen in other studies and surveys. These trends are the highest in a decade. And this will mean the fourth-straight year of increased spending growth following a decade of more moderate cost hikes.
Reasons for the major trends are the following:
- Medical treatments and therapies have become more sophisticated and more costly.
- Provider markets are increasingly consolidated, which means higher reimbursements/costs.
- Inflation broadly across the economy.
Mercer says 56% of employers intend to take cost-cutting measures for 2026, up from 48% in 2025. Deductibles and other cost-sharing will be increased.
Mercer says these steps in 2026 indicate a reversal of a trend over the past several years where employers have tried to shelter employees from higher costs.
Employers also will seek to better manage costs of the priciest claims and reviewing health programs to ensure they are providing value. Further, about two-thirds of large firms said they plan to enhance access to behavioral health as a strategy to manage overall costs.
See my recent blog on this topic: https://www.healthcarelabyrinth.com/my-biggest-worry-erosion-of-coverage/
#employercoverage #healthcare
Trump Investigates State Medicaid Spending For Immigrants Without Legal Status
The Trump administration will launch Medicaid spending probes in at least six Democratic-led states that provide comprehensive health coverage to poor and disabled immigrants living in the U.S. without permanent legal status. The Centers for Medicare and Medicaid Services (CMS) says it will review payments covering healthcare for immigrants without legal status to ensure there isn’t any waste, fraud or abuse. States can bill the federal government for Medicaid emergency and pregnancy care for immigrants without legal status.
The probe targets California, Colorado, Illinois, Minnesota, Oregon, and Washington. Utah, Massachusetts, and Connecticut, which provide Medicaid coverage only to children without such status, have not received notices of an investigation.
In other news, Modern Healthcare covers how states are planning for work requirements. Part of it is lessons from states that have had such waivers, including Arkansas and Georgia, as well as fallout from the re-establishment of Medicaid redeterminations post COVID pandemic.
Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-medicaid-work-requirements-unwinding/ and https://thehill.com/policy/healthcare/medicaid-spending-immigrants-investigation-democratic-states/ and https://www.medpagetoday.com/publichealthpolicy/medicaid/117327
(Some articles may require a subscription.)
#medicaid #trump #hhs #cms #fwa
CMS Struggles Attracting RADV Coders
CMS’ progress toward its 100% Medicare Advantage risk adjustment data validation (RADV) goals could be in jeopardy because it may not be attracting the 2,000 medical coders it wants. Current coding staff amounts to 40. Coders would manually review cases flagged by enhanced technology.
I called attention to this issue when the announcement occurred. Such coders are in high demand and will get paid more in the private sector. Further, who in their right mind would go work for an administration laying off by the thousands?
CMS has not provided an update on meeting the Sept. 1 hiring target. A spokesman declined to comment on hiring and no job postings for the positions currently appear on USAJobs.gov.
Additional article: https://www.beckerspayer.com/payer/medicare-advantage/cms-medicare-advantage-audit-expansion-hits-a-snag/
(Some articles may require a subscription.)
#medicareadvantage #riskadjustment #radv #overpayments
https://www.modernhealthcare.com/politics-regulation/mh-cms-medicare-advantage-audits
Moderate GOP Lawmakers Endorse Exchange Premium Subsidy Enhancement Extension
A group of 10 House Republicans are backing the Bipartisan Premium Tax Credit Extension Act, which would extend enhanced ACA subsidies for one year beyond their current expiration date at the end of 2025. The bill would also maintain the expanded eligibility criteria that allows households earning more than 400% of the federal poverty level to qualify for subsidies.
The move is clearly an effort by the GOP moderates to insulate themselves from the expected fallout during the 2026 midterms over the massive Medicaid and Exchange cuts in the budget reconciliation bill.
Additional article: https://www.politico.com/news/2025/09/04/aca-enhanced-tax-credits-extension-00544565
#aca #obamacare #exchanges
https://www.beckerspayer.com/payer/aca/gop-lawmakers-file-bill-to-extend-enhanced-aca-subsidies
Many in GOP Upset With RFK Jr. Over Vaccines
Many Republican senators have put the White House on notice that they are not happy with the conduct of Health and Human Services Secretary Robert F. Kennedy, Jr. The GOP senators are asking the Trump administration to right the healthcare policy ship of state. Much of the criticism revolves around vaccine policy and the running of the Centers for Disease Control and Prevention (CDC). They asked tough questions of Kennedy at a hearing this week on the goings-on at the CDC and his apparent lurch back to vaccine skepticism after he promised fairness at his confirmation hearing.
#hhs #rfkjr #cdc #congress #vaccines
https://thehill.com/homenews/senate/5487383-gop-senators-criticize-kennedy
— Marc S. Ryan
