How Can HR and the C‑Suite Align on Healthcare Costs?

How Can HR and the C‑Suite Align on Healthcare Costs?
May 14, 2026 7 mins

How Can HR and the C‑Suite Align on Healthcare Costs?

How Can HR and the C‑Suite Align on Healthcare Costs?

Rising healthcare costs are an enterprise issue for employers. Organizations know they need to take urgent action but often lack alignment on how. Understanding C-Suite perspectives and learning how to collaborate is critical.

Key Takeaways
  1. Today’s cost environment demands different approaches. A long-term strategy must replace incremental changes.
  2. Survey data shows that HR and C-suite leaders are not aligned on when and how to act on rising health costs.
  3. HR leaders need to reframe the narrative and position healthcare as a business risk priority. Understanding how the CEO and CFO view the issue is paramount.

Healthcare Costs Are a Critical Issue for Employers

The U.S. healthcare trend is at its highest point in about two decades. Aon is projecting a 9.5 percent trend in 2027, rising from nine percent in 2026. HR leaders know they need to act now to contain rising healthcare costs, but many are unsure of how to work with the C-suite to solve such a complex problem. 

Understanding Employer Healthcare Trend

U.S. Employer Healthcare Trend

HR and C-Suite Collaboration is More Important Than Ever

The old ways of managing costs simply don’t work anymore. Many employers have relied on incremental levers, including pushing costs to employees through plan design and contributions. Traditional options no longer work in today’s complex environment, where we’re seeing several dramatic shifts: 

  • Pharmacy as a primary driver and continues to be a major driver of overall trend: High‑cost drugs and specialty medications show up repeatedly as outsized contributors. And the pipeline for new high-cost therapies is robust.
  • Cancer treatment accounts for roughly 10 cents on every dollar of cost Cancer drugs are expensive and we are seeing more drugs at same time as more cancer diagnoses.
  • High‑cost claimants: Claims over $250,000 grew at around 13 percent annually from 2022 to 2024. A relatively small number of people account for a large share of total spend, and that share is growing. 
  • Place of service shifts: As the population gets older and overall health declines, care is increasingly moving toward services that are more intensive and expensive.  

Additionally, high trend doesn’t just show up in your P&L. It shows up as delayed or skipped care, more missed days and lower productivity. HR leaders care about people and workforce wellbeing, and they can also help finance leaders understand the less quantifiable costs of rising trend. Working with the C-suite in this dynamic way will be key to effective cost containment.

Quote icon

This isn’t just another tough year; it’s an inflection point. If organizations stick with a business as usual approach, healthcare will continue to consume a growing share of the rewards budget, leaving less room for wages, upskilling and other critical investments.

Lisa Barra
Senior Health Strategic Consultant, Aon

The HR and C-Suite Disconnect

Aon recently surveyed CEOs, CFOs and benefits leaders to better understand how they each view rising healthcare costs. When asked to identify a tipping point for taking action on costs, we see marked disparities between the C-suite and HR:

  • Only six percent of CEOs/CFOs aren’t sure where the tipping point is, compared to 30 percent of benefits leaders who lack a defined threshold.
  • Nearly one-third of benefits teams say they’ve already crossed the cost tipping point and are taking action. Yet only 21 percent of CEOs/CFOs share this view. 

Where HR looks at employee wellbeing, employee retention and inclusion, a CFO likely sees healthcare costs as a line item that’s growing faster than revenue. CEOs have a more macro-level view, seeing healthcare costs as a reputational issue. 

Containing rising health costs requires a completely different viewpoint: Rising trend is a shared enterprise risk, not just an HR problem to explain, or a finance problem to fund.

6%

of CEOs/CFOs aren’t sure where the tipping point is, compared to 30 percent of benefits leaders who lack a defined threshold.

How to Work With the C-Suite 

Benefits leaders need to frame the cost crisis in an impactful way. Instead of starting with vendor details or plan design mechanics, start with:

  • The macro story: “We are in the highest healthcare trend environment in 20 years. For us, that translates into X% cost increase and approximately $Y million in additional expense in 2027 alone.”  
  • The trade‑offs: “If we do nothing, healthcare will consume a larger share of total rewards spend, which limits what we can invest in wages, talent and growth.”  
  • The risk: “This is no longer just a benefits issue. It is a financial, talent, and reputational risk if we do not manage it thoughtfully.”

CFOs want to understand volatility and predictability. Bringing them a clear breakdown on price, utilization, and mix helps move the conversation from “our costs are up again” to “here’s what is driving it, and here’s where we can act.”

To partner effectively with your CFO:

  • Translate HR metrics into financial impact. For example, show how a 1‑point change in trend affects total healthcare spend, earnings or operating margin.  
  • Separate structural vs. cyclical drivers. Help distinguish between one‑time spikes (like a cluster of very high‑cost claims) and underlying pressures (like a sustained increase in high-cost drugs).  
  • Align on risk appetite.  Ask explicitly: “How much cost volatility are we willing to accept in our health plan? What level of member disruption is tolerable in pursuit of savings?”

Understanding risk appetite is critical. Some strategies – like more aggressive steerage, requiring employees to take specific actions, or eliminating benefits or programs – may have strong financial upside but also create employee friction. HR is uniquely positioned to explain those trade‑offs and shape what is acceptable.

1/3

of benefits teams say they’ve already crossed the cost tipping point and are taking action. Yet only 21 percent of CEOs/CFOs share this view.

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CFOs want predictability. Breaking down price, utilization and mix moves the conversation from ‘costs are up again’ to ‘here’s what’s driving them and what we can influence.’ It also helps align on risk appetite — how much volatility or disruption is acceptable.

Cristie Labus
Senior Health Actuary, Aon

With CEOs, the message often needs to connect directly to talent, culture and competitiveness:

  • Link to the employer value proposition: “Our benefits are a core part of how we attract and retain talent. If we respond to high trend with pure cost shifting, we risk undermining that value proposition.”  
  • Highlight the health‑performance connection: “Rising trend is partly driven by worsening population health, including chronic disease and mental health needs. Investing in appropriate care and prevention is essential to sustaining productivity and growth.”  
  • Frame HR as a strategic partner. “We need executive alignment on how we will manage healthcare in this new era. HR can lead the design and narrative, but we need C‑suite sponsorship.”

Another critical partnership point with the C‑suite is timeline. High trend won’t be resolved in a single renewal cycle. Create a three-year roadmap that manages disruption and allows for course correction. Measure results and use data to inform decisions. 

HR’s Time to Lead

Leaders and employees look to HR not just to manage benefits, but to guide them through an increasingly complex healthcare landscape. Lean on your strengths and understand the strengths and perspectives of the C-suite. Taking action on healthcare costs takes a team – one that HR is uniquely positioned to lead. 

General Disclaimer

This document is not intended to address any specific situation or to provide legal, regulatory, financial, or other advice. While care has been taken in the production of this document, Aon does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose of the document or any part of it and can accept no liability for any loss incurred in any way by any person who may rely on it. Any recipient shall be responsible for the use to which it puts this document. This document has been compiled using information available to us up to its date of publication and is subject to any qualifications made in the document.

Terms of Use

The contents herein may not be reproduced, reused, reprinted or redistributed without the expressed written consent of Aon, unless otherwise authorized by Aon. To use information contained herein, please write to our team.

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