Curbing Chronic Conditions to Control Employer Health Costs

Meaningful reductions in health risks and chronic condition prevalence across your employee population is a sustainable way to manage rising healthcare costs (with the added bonus of also improving other workforce cost and performance outcomes).

Effective reduction of modifiable risks across an employee population can mitigate rising healthcare costs.

Employer health benefit costs appear on track for their steepest increase in over a decade, with many estimating average costs could tip 7.6-9.5% in 2026. The compounded impact of these expected year-on-year increases is that healthcare costs will be 60% higher in 2026 compared to what they were in 2017. Inflation like this hits employers hard, but when employers are able to curb these cost increases, it can present a competitive cost advantage.

The reason for the steep increases are multifactorial, but price pressure and high utilization rates are commonly cited as primary drivers. (See this Mercer article for an explanation).

Employers adopt a range of strategies in an attempt at cost-containment - but many rest heavily on plan redesign, cutting coverages, or cost shifting strategies. Are these strategies sustainable? Are they popular with employees who are left with more out of pocket expenses or higher deductible plans? Is there anything else that can be done?

One of the key drivers of increasing costs is increasing utilization. It has been well established with over 30 years of literature in public health, wellness, and lifestyle medicine data that health costs follow health risks. That is: As people accumulate health risks and become more complex and chronic, their healthcare costs increase in tandem. (If you haven't read it before, section 1 of Dee Edington's 2009 book, Zero Trends outlines the business case and cost flows brilliantly).

As Edington outlined, delaying, preventing or reversing the accumulation of modifiable health risks, if done broadly enough across a population, should delay, prevent, or slow the rate of healthcare cost accumulation and flatten the rate of cost increases; hence the term "zero trend".

This is a common ideology of workplace wellness programs, however many traditional disease management or incentivized self-directed wellness resource models have not been effective in achieving widespread sustainable behavior change at the scale necessary to shift the costs of a whole employee population. Most organizations only get around half of their employees to complete incentivized basic health screenings and less than 20% of their population to engage in any meaningful health coaching or lifestyle intervention (industry data on this is pretty consistent between WTW, PwC and Aon etc).

This, unfortunately, has led to many people being critical of workplace wellness and generalized claims that they are ineffective. While it's true that many attempts at workplace wellness have failed to live up to expectations, does that mean nothing will work? Does it mean there is no value in any programs?

No. It just means that the most commonly implemented program models are under-achieving and a majority of employers are leaving value on the table.

It means that for those that do it right - there is not only substantial value and a genuine opportunity to sustainably mitigate healthcare cost increases, but as it's still not widely achieved, meaning it still represents a potential competitive advantage.

Even beyond the potential healthcare cost advantage, there is also an abundance of recent evidence in employee engagement and sentiment data to indicate that the best talent actively seek employers who demonstrate that they really care for their wellbeing.

So can it actually be done? Can programs actually be designed that can demonstrate population-wide risk reduction, and does that risk reduction appear to flatten the year-on-year healthcare cost curve?

Yes! We are proud to say that HBD has demonstrated the zero trend theory in practice - and it is absolutely achievable in more work environments than you might imagine.

Side by side comparison of Edington's 2009 "Zero Trend" theory and the key benchmarks programs need to reach to achieve it (from his book, Zero Trends). next to real claim data and program outcomes from an 11,000 employee real world work population.

Many approaches in workplace wellness are centered on providing individual-level resources and trying to promote or incentivize people to use them to improve their health. This fails to recognize that a majority of the population is not at a stage of readiness (not initially interested or self-motivated) to actively make healthy changes. So the resources go unused or see high attrition rates once basic incentives are obtained.

HBD's total population approach effectively integrates health promotion, in many cases, including health coach contact, into the normal work environment and workflow. This organic engagement reaches much further across a population than programs that require employees to actively engage on their own.

With total population engagement, the progressive education and resultant improvements in health literacy lead to far higher rates of behavioral change at the population level; eventually resulting in significant shifts in the prevalence of health risks. This effectively prevents, delays, and with some risks, reverses the costly accumulation of health risks and the progression of chronic conditions.

The cost of healthcare will continue to rise, and chronic conditions will continue to be primary drivers. The American College of Lifestyle Medicine says 6 core health behaviors (nutrition, physical activity, stress management, avoiding risky substances, sleep, and social connection) drive 15 chronic conditions that are responsible for 80-90% of U.S. healthcare expenditure. Effective population-wide health behavior change is a genuine and sustainable cost containment strategy.

As you head into 2026 and absorb these significant healthcare cost hikes - take a look at the performance of your health promotion strategies and if they are not effectively shifting the needle on risk prevalence at your whole group level, then it is time to consider a significant shift in your employee health management strategy.

For more details on the outcomes of HBD programs, case studies, or for a no-obligation review of your current health promotion outcomes and recommendations, please contact us.