3 ways to tackle employee healthcare affordability in 2025

Rising healthcare costs are a growing burden for employees—and employers aren’t immune to the effects either. According to a PwC report, nearly 3 in 10 employees struggle to pay their medical bills.¹ Worse yet, 28% of consumers skip, delay, or stop care altogether because they can’t afford it. The trend is most pronounced among younger generations, with 39% of Gen Z and 33% of Millennials saying cost is a barrier to care.

In a recent webinar, 3 benefits trends to watch for in 2025, our panel of experts outlined how employers must find innovative ways to make healthcare affordable for their workforce while maintaining a sustainable benefits budget. If you’re wondering what steps to take, good news—you likely already have the tools to help.

By designing a benefits plan that reduces costs, educating employees on preventive care, and leveraging solutions like high-deductible health plans (HDHP) and Health Savings Accounts (HSA), you can bring meaningful financial relief to your team. And you can foster long-term trust and loyalty in the process.

Here’s how to meet the employee healthcare affordability challenge head-on.

Building a benefits plan designed to ease the burden

High healthcare costs don’t have to be inevitable. With a thoughtfully designed plan and focused education efforts, you can reduce costs while ensuring your benefits program fits the financial and healthcare needs of your workforce. Here are three strategies that can help get you started.

1. Unlock the power of HDHPs and HSAs

HDHPs, when paired with an HSA, can be a powerful cost-saving tool because employees can save on premiums and have access to pre-tax funds they can use on healthcare expenses. Educating employees about how to effectively use these accounts—such as leveraging employer contributions or maximizing tax savings—can make HDHPs much more appealing.

HSAs offer triple-tax advantages: contributions are tax-deductible, earnings grow tax-free, and distributions for qualified medical expenses are also tax-free. Employees can use HSAs to cover a wide range of healthcare costs, from doctor visits and prescriptions to dental and vision care. Additionally, unused funds roll over year after year, allowing employees to build a significant healthcare nest egg over time. For those nearing retirement, HSAs can even serve as a backup savings account for future medical expenses, further enhancing their value.

When paired with HDHPs, HSAs provide both immediate and long-term financial benefits, making them a smart choice for employees who understand how to maximize their potential.

Employer tip: Implementing an automatic minimum contribution to employee HSAs may be a good solution to boost plan engagement. When employees contribute even a small amount to their HSAs every pay period, they actively save for healthcare expenses and contribute toward their financial wellbeing.

Consider implementing Health Payment Accounts

Health Payment Accounts (HPAs) are another effective tool that can help employees manage their healthcare expenses more efficiently. They offer a seamless way for employees to handle medical bills by converting them into easy, interest-free payment plans. Employees can use the funds in their HPAs to pay for routine checkups, emergency care, dental and vision services, and other essential health needs.² Read how one company used HPAs as a solution to help their employees afford and seek care.

This versatility ensures that employees have a financial cushion to address immediate health concerns without compromising their overall financial stability. Additionally, HPAs offer both virtual and physical debit cards, making it easy for employees to access funds when they need them most. Employees can even pay back HPA funds with their HSA dollars!

For employers, HPAs can enhance their benefits package and demonstrate commitment to supporting their employees’ health and financial wellbeing. By educating employees on the advantages of HPAs and how to maximize their use, employers can foster a more informed and health-conscious workforce.

Employer tip: Be sure to educate your workforce on the benefits of HPAs so they’ll understand the difference between this line of credit and their HSAs, and when to use each account.

Promote the benefits of preventive care

The Internal Revenue Service (IRS) continues to expand the number of preventive services covered under HDHPs, making it one of the most effective ways to lower long-term healthcare expenses. Sadly, many employees avoid routine checkups and screenings because they’re unaware that these services are often covered at no cost under most insurance plans.

Regular checkups and screenings can help detect potential health issues early, often before they become serious or costly to treat. These proactive measures not only reduce the risk of developing chronic conditions but also provide peace of mind by ensuring an individual’s health is on track.

By prioritizing preventive care, individuals can enjoy better health outcomes, fewer missed workdays due to illness, and lower medical expenses in the long run. Employees who take advantage of no-cost preventative care services invest in both their health and financial future.

Employer tip: Employers can design a wellness program that includes directly contributing to their employees’ HSA when they participate in preventive care. Also consider launching an internal awareness campaign to highlight the benefits of preventive care. And include reminders around open enrollment and encourage employees to take advantage of annual wellness visits, vaccinations, and health screenings.

Implement cost transparency tools

Many employees struggle to understand the “true cost” of their healthcare until after they’ve received a bill. This lack of clarity can lead to financial stress and difficulty managing medical expenses.

Additionally, many people aren’t actively looking for the best healthcare option for their finances, and employees may unknowingly choose more expensive providers when lower-cost, high-quality alternatives are available. According to a McKinsey study, close to 90% of American consumers say they’re willing to price shop for at least one type of healthcare, yet 64% have never done so.³

Healthcare cost transparency tools are changing the game by helping employees estimate costs in advance, compare pricing across providers, and better understand their healthcare options. By enabling employees to make more informed decisions, these tools improve the healthcare experience, increase access to high-quality care, and help lower costs.

When employees can choose more affordable care options—such as in-network providers or lower-cost facilities—they can avoid unnecessary expenses, ultimately saving money for both themselves and their employers. Transparency tools empower smarter choices, making healthcare more accessible and budget-friendly for everyone involved.

Employer tip: Partner with providers who can analyze medical claims data and highlight patterns of overspending within your organization. This visibility, coupled with cost transparency tools, makes it even easier for employees to understand their healthcare. Make these tools easy to access, and train employees on how to use them effectively for maximum value.

2. Engage employees to boost benefits adoption

Designing a cost-efficient benefits plan is just one piece of the puzzle. The next step is to ensure your employees actually use it. Without proper engagement, even the most well-crafted plans can fall flat.

Here’s how to encourage adoption, especially for employees who are harder to reach:

• Host benefits education sessions: Conduct regular, accessible webinars or live Q&A sessions to explain your benefits offerings.

• Use personalized communications: Programs like Engage360 can provide personalized benefits information to each employee’s specific needs, making them more likely to engage.

• Leverage workplace champions: Identify and empower a group of employees who can advocate for the benefits program to answer peer questions and encourage participation.

3. Bring technology into the mix

Technology is changing the way benefits plans are managed, and 2025 will see even greater advancements in AI and automation. Employers now have access to tools that analyze claims data, provide cost transparency, track employee engagement, and even deliver personalized recommendations for healthcare options. HSAnswers is an example of how AI makes learning about HealthEquity benefits easier through a chat experience.

By leaning into technology, you can meet your employees where they are and offer them the resources they need to make smart, cost-effective healthcare decisions.

A brighter 2025 for employee healthcare

Making healthcare more affordable doesn’t just improve your employees’ wellbeing—it also strengthens your organization. By reducing financial stress, boosting engagement with your benefits package, and promoting preventive care, your team will feel valued and supported, leading to higher productivity and morale.

The 2025 trend toward increasing employee healthcare affordability may seem daunting, but the opportunity to create meaningful change is immense. Equip yourself with the latest strategies, tools, and key insights to take that first step.

Want to learn more? Watch our webinar replay for actionable strategies to create affordable, effective benefits employees will love. You’ll also hear expert advice on engaging hard-to-reach employees and leveraging AI for better cost transparency.