Engaging Employers in Addressing Health Care Affordability 

Rising health care costs impact businesses across the country. Whether it’s capital investments, benefits and hiring, or wage growth, business decisions are being adversely impacted by rising health costs. In Connecticut, where we are staff members at the Office of Health Strategy (OHS), employers have identified health care as a major concern. More than half (53%) of businesses surveyed by the Connecticut Business and Industry Association indicated dissatisfaction with the quality and cost of health care and insurance. Nearly one-quarter (23%) said state legislators should prioritize health insurance costs in the 2025 session. A challenge for the OHS, however, is how to get employers engaged in the policy process so we can advance change together. Employers, particularly small and mid-sized employers, may have limited time, expertise, or resources to navigate the complex business of health care purchasing. Yet these smaller employers are especially vulnerable to increases in health care costs. We want to engage these employers and provide tools to help them navigate the health care affordability challenge, so they can ultimately focus on their business and their employee growth and development.

Health Care Costs Threaten Employees and Productivity 

Rising health care costs are imposing a growing burden on both employees and employers in our state. As costs go up, employers make tough decisions about where to allocate their money, leaving employees shouldering more of the cost. From 2014 to 2023, the share of Connecticut family health insurance premiums contributed by employees rose from 22% to 30%, from just over $4,000 to almost $8,000 (See Figure 1).   

Figure 1. How Employers and Employees Split Connecticut Health Insurance Premiums 

Source: Agency for Healthcare Research and Quality, Medical Expenditure Panel Survey – Insurance/Employer Component, Connecticut State Tables, 2014-2023 

Impact of Rising Prices 

OHS’s cost growth target program analysis, like that of other states that track spending, show that prescription drug and outpatient hospital spending are driving costs rather than an increase in use of services. According to the Health Care Cost Institute, health care prices in Connecticut’s major markets are higher than national or regional averages. Patients in the Hartford (+17%), New Haven (+22%) and Bridgeport (+28%) markets pay well above the national average for care, and it is taking a toll on state residents. One-third (33%) of state residents are struggling to pay medical bills. Nearly half (46%) have delayed or foregone needed care due to cost, and most (78%) worry about future healthcare expenses (See Figure 2). The  Connecticut Health Care Affordability Index shows that, of households with access to commercial insurance through their employer, 13.8% can’t afford basic needs.   

Figure 2. The Toll of High Health Care Costs on Connecticut Residents  

Source: Healthcare Value Hub. Connecticut Residents Struggle to Afford High Healthcare Costs; Worry about Affording Healthcare in the Future; Support Government Action across Party Lines. Altarum. October 2022. https://www.healthcarevaluehub.org/advocate-resources/publications/connecticut-residents-struggle-afford-high-healthcare-costs-worry-about-affording-healthcare-future-support-government-action-ac  

The impact of rising health care costs reaches far beyond the factory floor or the family room. One recent study suggests that a 5% increase in health care prices results, at a county level, in $32 million in lost wages, over 200 lost jobs, and $6.8 million in lost federal tax revenue. Workers earning under $100,000 experience the most concentrated effects. 

Grassroots Engagement 

Connecticut, which has had a health care cost growth benchmark program since 2022, addresses health care cost growth, quality, and primary care investment at a policy level, but the work doesn’t end at the statehouse door. Governor Ned Lamont convened some of the state’s largest employers in 2023 to hear their concerns about health care costs, quality, and affordability and reinforce the importance of having self-insured employers share their health care cost data and experiences with the all-payer claims database and the benchmark program to improve the comprehensiveness of spending analyses that can point to additional policy solutions.   

More recently, Governor Lamont, State Comptroller Sean Scanlon, and Connecticut’s Office of Health Strategy (OHS) brought small and mid-sized employers together to learn more about what employers and health care purchaser coalitions have accomplished in other states like Indiana. Chambers of commerce across the state brought members to the November 2024 event and are now helping to organize regional learning collaboratives for employers led by cost growth benchmark program staff.   

These regional learning opportunities are focused on helping small to mid-size employers better understand: 

• Health care spending drivers 
• How self-insured employers can ensure that their claims experience is included in state initiatives to address health care cost growth 
• How employers in other states are leveraging their collective influence through advocacy, direct purchasing, health promotion, third-party administrator accountability and transparency initiatives, and other strategies  

Digital Toolbox for Employers and Employees 

Connecticut has also launched digital tools to support health care consumers of all kinds – including employers and their employees – navigate issues related to health care costs, affordability, and access.   

The Connecticut Healthcare Affordability Index interactive tool measures the impact of health care costs, including premiums and out-of-pocket expenses, on a household’s ability to afford all basic needs, like housing, transportation, childcare, and groceries. The tool helps employers, community leaders, policy makers and others understand if residents are earning enough to meet their needs. 

Connecticut’s Healthcare Cost Estimator provides health care consumers with useful information about the typical costs of specific medical services and procedures throughout the state. Informed consumers can make better choices about non-emergency health care and health care spending. 

Connecticut’s Imaging Inventory is an interactive tool to help consumers locate and learn more about imaging services available across the state. The inventory allows consumers to search for CT, MRI and PET-CT facilities by map or by table, and to define how far from home to extend the search. 

Connecticut’s approach to slowing cost-growth solicits participation from all key stakeholders, including providers, payers, the pharmaceutical industry, consumers, advocates and policy makers. By expanding our outreach to engage and empower employers and employees, chambers of commerce, and other business associations, we hope to unite policy initiatives with the power of the purchaser and make health care more affordable.