Employer health plans are seeing a lot more participants with very high costs, according to a new report from Lockton.
The firm runs an employer plan database that holds information on 882 employer groups and 3.9 million plan participants.
One of the plan participants submitted $9.15 million in claims in 2024, and nine others submitted more than $4 million in claims, according to the firm’s analysis of the plan data.
Lockton has not published the actual rate of patients with very high claims per 1 million plan enrollees per year.
But it says that the odds that a patient would have $1 million to $2 million in annual claims increased by 45% between 2022 and 2024.
The odds that a patient would have $2 million or more in annual claims increased by 47%.
One culprit was a big increase in the cost of caring for people with cancer.
The average cost of chemotherapy for cancer climbed to $12.61 per member per month in 2024, from $4.53 per member per month in 2023.
The backdrop: The new Lockton report adds to evidence that U.S. patients are using more care.
Fitch recently cited an increasing need for care as a reason to adopt a negative outlook for the entire U.S. health insurance sector.
Sun Life U.S. sells stop-loss insurance, or arrangements that protect employers’ self-funded health plans against catastrophic losses.
Sun Life U.S. reported the number of patients at its customers’ plans who had annual claims of $1 million or more increased 29% between 2023 and 2024, to 221 $1million-plus claims per 1 million plan participants.
A physician’s views: Dr. Shealynn Buck, the chief medical officer at Lockton, said during a video presentation posted by the firm that she believes that the increase in U.S. patients’ need for care is affecting physicians, hospitals, pharmaceutical manufacturers and other players in the U.S. health care system, as well as employers and other payers.
“All health care stakeholders are feeling this squeeze,” Buck said. “Everybody’s really trying to protect their margins.”
One solution is for employers and other payers to focus more on wellness and health plan participant use of health screenings, to keep people healthy and to prevent small problems from leading to $1 million claims, Buck said.