NEW YORK CITY, New York: Rising spending on weight-loss and specialty drugs is prompting a majority of large U.S. employers to scale back health benefits in 2026, as budgets come under pressure, a new Mercer survey released on July 16 shows.

Among companies with 500 or more employees, 51 percent said they plan to increase cost-sharing for workers in 2026 — such as by raising deductibles or out-of-pocket maximums — up from 45 percent who plan similar increases in 2025.

Soaring costs of GLP-1 weight-loss drugs, such as Wegovy, are at the heart of employer concerns. According to Mercer, 77 percent of employers now rank Wegovy as a top cost concern.

"More clients are saying ... ‘I don't know how much longer we can sustain covering these medications,'" said Alysha Fluno, a pharmacy innovation leader at Mercer.

While some companies initially offered coverage for GLP-1 drugs in hopes of lowering long-term health costs tied to obesity, surging prices are causing second thoughts.

"Some employers facing big cost increases in 2026 may feel this coverage is out of reach," Fluno said.

Competition from new drugs in the coming years may give pharmacy benefit managers (PBMs) more leverage to negotiate lower prices. The current GLP-1 drugs list costs over US$1,000 per month, though many insured patients pay less.

The Mercer report says prescription drug costs jumped eight percent last year, and overall health benefit costs are expected to rise 5.8 percent in 2025.

Employers are also rethinking their relationships with PBMs — middlemen between drugmakers and insurers — amid concerns over transparency and pricing practices. Thirty-four percent are considering switching PBMs, and 40 percent are exploring alternative drug pricing models.

The scrutiny follows regulatory criticism of major PBMs like CVS Caremark, Express Scripts, and Optum Rx for steering patients toward high-cost drugs — a claim the industry denies.

This week, CalPERS, one of the nation's largest public healthcare purchasers, announced it would switch PBMs in 2026, citing the need for better oversight and transparency.