2025 Mid-Year Benefits Trends to Monitor
July 29, 2025
Explore key mid-year employee benefits trends, including global economic shifts, AI integration, and rising healthcare and wellness demands
Explore key mid-year employee benefits trends, including global economic shifts, AI integration, and rising healthcare and wellness demands
Employer-sponsored benefits have been undergoing rapid and complex transformations. Whether due to the ripple effects of global trade policies or the accelerating adoption of artificial intelligence (AI), employers are navigating a benefits environment shaped by economic uncertainty, political shifts, and medical innovation.
At the same time, employees are facing mounting pressures, including rising healthcare costs and growing mental and financial strain, prompting organizations to rethink how they support their workforces’ well-being.
Staying in the know on the latest benefits trends, especially mid-year, can help employers evaluate their offerings to best meet employee needs, respond effectively to challenges, and gain a competitive edge.
The specialty drug market is surging in 2025, driven by a wave of U.S. Food and Drug Administration (FDA) approvals and a growing pipeline of advanced therapies. These high-cost treatments now dominate the pharmaceutical landscape, accounting for 80% of FDA approvals this year. As more plan participants rely on these drugs, employers must prepare for rising costs and evolving coverage needs.
This rapid growth is being fueled by more plan participants using these key specialty drugs:
Biologics remain central to treating complex conditions like autoimmune diseases and cancer. As major biologics lose exclusivity, biosimilars are emerging as cost-effective alternatives. The FDA approved 19 biosimilars in 2024, up from just five in 2023, with 10 more already approved in 2025. These benefits trends are expected to continue, with predictions indicating that at least 10 new biosimilars will be approved annually over the next five years, prompting employers to revisit formulary strategies and explore ways to integrate biosimilars into their plans.
These treatments are seeing a record number of approvals in 2025, with several first-in-class therapies entering the market. Whether it’s cell therapies for blood cancers or gene editing for rare genetic disorders, these innovations promise transformative outcomes but also come with significant cost and logistical challenges.
Initially developed for diabetes, GLP-1 drugs are now widely used for weight management and cardiovascular health. Their popularity is growing, with over 100 new GLP-1 drugs in development and more expected by 2026. These drugs suppress appetite but can lead to muscle loss, prompting manufacturers to develop versions that preserve muscle mass. Employers must decide whether to cover GLP-1s for weight loss and prepare for the potential cost implications.
As specialty drugs continue to reshape healthcare, employers should remain proactive by monitoring benefits trends, adjusting plan designs, and educating employees to ensure cost-effective and appropriate use of specialty drugs. For a deeper dive into these developments, watch Navigating the Future of Medical Benefits, a webinar presented by The Miller Group.
In the first half of his second term, President Donald Trump has issued executive orders (EOs) signaling key healthcare priorities that could affect employer-sponsored health plans.
One EO focuses on expanding healthcare price transparency, directing federal agencies to enforce rules that require hospitals and insurers to disclose actual prices for services and prescriptions. Another EO aims to reduce the cost of in vitro fertilization (IVF), calling for policy recommendations to lower out-of-pocket and health plan expenses for fertility treatments
While these actions don’t immediately change legal requirements, they serve as strong indicators of the administration’s direction. Regulatory agencies are expected to follow with proposed rules and enforcement strategies. For example, the Department of Health and Human Services (HHS) has already issued a proposed rule that would tighten eligibility and enrollment standards in the Affordable Care Act (ACA) Marketplaces, including changes to income verification and special enrollment periods
Employers should prepare for potential regulatory shifts by monitoring developments and assessing how new policies may affect coverage. Collaborating with third-party vendors to update communications plans and tools will be essential. Staying informed will help employers adapt to evolving requirements and maintain compliance while supporting employee access to care.
Americans are accustomed to economic uncertainty. In the last few years, they have faced a pandemic, disrupted supply chains, and high inflation. Now, concerns surround impending tariffs, a shifting stock market, and speculation over whether the Federal Reserve will issue interest rate cuts in 2025.
This year, financial stress is weighing heavily on individuals due to the current economic climate and has taken a toll on many employees’ well-being. Prolonged financial stress can lead to anxiety, depression, and other health concerns, including sleep disturbances and a higher risk of cardiovascular disease. It can also lower an individual’s resilience, making it more difficult to cope and bounce back from hardships. By recognizing this, many employers are stepping in with targeted support to help employees regain control of their financial lives.
To support employees in achieving financial goals and mitigating mental health impacts, employers are enhancing their offerings with retirement planning resources, online financial tools, and education to promote healthy financial habits. Competitive compensation and benefits remain key to attracting and retaining talent, with many employers now including financial counseling, education, and legal support to address debt and rising costs. Investing in financial wellness programs is proving to be a strategic move, fostering a more resilient and stable workforce.
Pharmacy benefit managers (PBMs) are facing heightened scrutiny in 2025 as concerns mount over their role in driving up drug prices and limiting access to care. These intermediaries, who negotiate between drug manufacturers, insurers, and pharmacies, have been criticized for unclear pricing practices and contributing to the closure of independent pharmacies. In particular, the practice of “spread pricing”, where PBMs charge health plans more than they reimburse pharmacies, has drawn fire for inflating costs and reducing pharmacy sustainability.
While federal reform efforts have stalled, states are stepping up. Idaho and Vermont have already banned spread pricing, and other states are exploring similar legislation to increase transparency and accountability.
A major blow to federal reform came in late 2024 when a proposed PBM reform package was dropped from a spending bill, leading to the closure of over 300 pharmacies, many in rural and underserved areas. This has intensified calls for structural changes, including proposals to prevent PBMs from owning or operating pharmacies, which critics argue creates conflicts of interest.
For employers, this evolving landscape presents both challenges and opportunities. With legislative, legal, and market-based reforms all in motion, now is a critical time to reassess how prescription drug benefits are managed. Employers should monitor PBM practices closely, explore alternative benefit models, and consider diversifying vendor relationships to ensure cost control and employee access to affordable medications. As the push for transparency continues, staying informed and proactive will be key to navigating the shifting terrain of pharmacy benefits.
Artificial intelligence (AI) is revolutionizing how employer-sponsored benefits are designed and delivered. Nearly half of employers now use AI tools to streamline operations like benefits enrollment, claims processing, and compliance, according to SHRM’s 2025 State of the Workplace report. These technologies are helping organizations offer smarter, faster, and more personalized benefits experiences.
For employees, AI provides personalized recommendations based on individual data like health history and lifestyle choices. This customization enhances satisfaction and usage, especially for services such as mental health support or chronic condition management. AI-driven chatbots and virtual assistants also make navigating benefits easier, helping employees compare plans, estimate costs, and make informed decisions during open enrollment or major life changes.
Employers benefit from AI through automation and predictive insights. Routine tasks like eligibility checks and reporting are handled more efficiently, freeing up HR teams to focus on strategy. AI also helps anticipate future healthcare needs, allowing companies to proactively adjust offerings.
As AI becomes more embedded in benefits platforms, employers must prioritize ethical use, data privacy, and employee training to ensure trust and maximize impact.
As U.S. trade policy evolves, new tariffs on imported medical goods and pharmaceuticals are beginning to impact the healthcare system, and employer-sponsored coverage is feeling the pressure. Hospitals and providers are facing rising costs for essential supplies, which are often passed down the chain to insurers, employers, and ultimately, employees through higher premiums and out-of-pocket expenses.
The pharmaceutical sector is particularly vulnerable, given the U.S. reliance on imported medications. Proposed drug tariffs could drive up prices and create supply disruptions, despite manufacturers’ efforts to stockpile inventory. While many employers are temporarily shielded by existing insurance contracts, future renewals may reflect these increased costs through narrower networks, higher deductibles, or reduced plan generosity.
To stay ahead, employers must remain agile and proactive. Strategic planning, cost containment, and innovative care delivery models, such as direct provider contracting or expanded preventive care, will be key to managing the financial impact of shifting trade policies on employee benefits.
Finding ways to manage rising health care costs while keeping benefits affordable for employees is critical for employers as open enrollment approaches; however, it won’t be easy.
Healthcare costs in the U.S. continue to rise sharply, and 2025 has offered little relief. McKinsey projects a 9–10% increase through 2026, driven by inflation, growing demand for services, and the escalating cost of specialty drugs and advanced treatments.
Employees are also feeling the impact. A recent KFF analysis found that over one in four adults delayed or skipped care in 2024 due to cost concerns. Rising deductibles and copays are adding financial strain, prompting employers to rethink their benefits strategies. As open enrollment approaches, many are expected to adopt cost-containment tactics like tighter contract negotiations, increased cost sharing, and expanded wellness initiatives.
Looking ahead, employers are considering alternative funding models such as level-funded plans and direct-to-consumer prescription programs to control costs more effectively. Strategic, value-driven benefit design will be crucial for navigating the challenges of 2026 benefits trends and beyond, helping employers support their workforce while maintaining financial resilience.
As healthcare costs increase and regulations change, employers must adopt a proactive strategy for the rest of 2025. Whether it’s preparing for the financial impact of specialty drugs, navigating PBM reform, leveraging AI for personalized benefits, or staying informed and flexible, these will be essential to maintaining competitive, employee-focused benefits.
While the right approach will vary by industry and workforce, understanding current trends can help employers make meaningful decisions. Recognizing these shifts allows organizations to build trust, enhance employee well-being, and deliver long-term value through smarter benefits strategies.
Employers who stay proactive and responsive will be best positioned to manage change and support their teams effectively.
For more insights and guidance on the latest benefits trends, reach out to a trusted advisor today.
