Cancer and Specialty Pharmaceuticals Are Top Claimant Concerns

High-dollar claimants continue to concern employer-sponsored health plans in the U.S. Those that self-fund and purchase medical stop-loss coverage have seen premiums continuing to rise over 10% annually, as reported by the 2024 Aegis Risk Medical Stop-Loss Premium Survey, cosponsored by the International Society of Certified Employee Benefit Specialists. In its 18th edition, this year the survey measured over $1 billion in annual premium across more than 1,100 stop-loss policies and covering more than 1.1 million employees.

When asked about the type of catastrophic health claimants that are their top two or three concerns in the next year, responding plan sponsors cited cancer and specialty pharmacy as the two most prominent. Top claimant concerns include:

• Cancer/neoplasms, including leukemia—83%
• Specialty pharmacy—50%
• Gene and cell therapies—29%
• Heart/cardiovascular—27%
• Newborn/infant care—24%
• Lengthy inpatient hospital stays—23%.

Measured from 2022 to 2024, annualized increases in individual stop-loss premiums range from 10.4% at a $100,000 deductible to 13.8% at a $750,000 deductible. This dynamic, known as leveraged trend, occurs as the underlying increase in expense of a catastrophic medical claimant is fully borne by an unchanged stop-loss deductible from one year to the next. The more immediate change from 2023 to 2024 reflects a lower increase not exceeding 9.1% at any deductible, potentially reflecting softer renewal pricing for the 2024 policy period.

According to the survey, the average monthly premium per covered employee at a $100,000 deductible is $210.80; at a $500,000 deductible, it is $46.30. At a $1,000,000 deductible, the premium lowers to $13.84 per covered employee per month. For this survey, all contracts are equated to a mature paid contract. A paid contract will cover all claims that are paid during the 12-month policy period regardless of when claims are incurred.

The 2024 Aegis Risk Medical Stop-Loss Premium Survey was done in partnership with the International Society of Certified Employee Benefit Specialists (ISCEBS). It measured data from 1,137 plan sponsors covering over 1,100,000 employees with slightly more than $1 billion in annual stop-loss premium. The survey further measures additional stop-loss policy provisions, including aggregate stop-loss, individual stop-loss deductible size by employee size, contract type and the presence of renewal exclusions or lasering.  A copy of the full survey is available on the ISCEBS website or by request at [email protected].

Ryan A. Siemers, CEBS

Ryan is a principal at Aegis Risk LLC, focusing on medical stop-loss and the risk management of catastrophic medical claimants. He has performed numerous medical stop-loss analyses for private and public employers throughout the United States. Siemers is the author of the annual Aegis Risk Medical Stop-Loss Premium Survey, done in partnership with the International Society of Certified Employee Benefit Specialists (ISCEBS).