Employers are increasingly investing in preventative healthcare, with 67% doing so to curb rising medical costs, according to Howden.
Howden’s Changing Face of Employee Health report highlights the growing prominence of healthcare as a core employee benefit and found that health support is becoming a stronger factor in workforce decisions.
Three in five employees or 61% say they are more likely to stay with an employer that offers a good healthcare package, while 47% consider it important when assessing a new role. Only 7% of workers globally say healthcare is not an important benefit.
Employers are continuing to focus on prevention and wellbeing. Globally, 67% say they have adopted this strategy, with 55% identifying it as the most effective measure they have used to manage rising medical costs.
The report shows that rising medical inflation is the main factor behind increased employer investment in prevention and wellbeing. Howden’s insurer data within the report predicts medical inflation of 7% in 2026 net of CPI, meaning total inflation will be well above 10%.
According to the report, most employers believe their health provision is effective. Globally, 93% say their health plan meets employee needs and 86% believe they achieve a good return on investment. Employee sentiment is more mixed. One in four employees, or 25%, do not agree that their employer supports their wellbeing.
The report also highlights ongoing changes in the market with 23% of employers switching healthcare providers to secure a better deal. Meanwhile, 39% are planning to switch and a further 26% would consider switching if they found a better option.
The report also shows that 93% of employers expect medical costs to increase and 41 per cent expect a significant rise. Regional expectations vary. Employers in IMEA expect costs to rise by 58%. The figure is 27% in Europe, 28% in the UK, 52% in Asia, 46% in LATAM and 36% in the Pacific.
Howden CEO and global practice leader of health & employee benefits Glenn Thomas says: “The findings show how quickly the world is shifting, with AI, new treatments and rising costs reshaping the health and benefits landscape. Employers are feeling the pressure. If organisations don’t recognise their people as their greatest asset and address people risks directly, productivity and growth will suffer. A healthy workforce is now the engine of performance.
“What stands out in the data is the gap between what employers believe they’re delivering and what employees say they’re receiving. Healthcare benefits are becoming non-negotiable for talent, yet many workers still feel their needs aren’t being met. It’s no surprise that so many businesses are now looking at substantial changes.
“Leaders can’t afford to wait. The pressures highlighted in this report show just how fast things are moving. Benefits must be both cost-effective and genuinely fit for their people.”
