Fixing employer sponsored healthcare would improve lives of 180M Americans.

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Average annual premiums for an American family have hit nearly $27,000, rivaling the cost of a new car.

It’s now well-documented that costs are the primary issue impacting both health care coverage and access. Limited choice also fuels this dynamic. As frustration with traditional offerings continues to rise, employers and employees alike are opting to forego health insurance altogether.

Too often, the system has operated under the “more of the same” mentality or shifted towards incremental changes to payment models that fail to reward good behavior or prioritize more transparent, streamlined decision-making.

Simply put, we need alternative options. Innovation is underway – but the commercial market has much room for headway.

We’ve seen pockets of progress, which is encouraging. Alternatives like narrower networks help offset costs and reduce waste by steering employees to higher performing providers, which drive better outcomes. Individual coverage health reimbursement arrangements, or ICHRAs, reduce the likelihood of “over insurance” and create an entry point for employers, especially small and mid-sized businesses, to offer health plans that meet the individual needs of employees and their families. Integrated models, where the provider is dually responsible for both clinical improvements and financial risk, underscore the importance of aligned incentives between insurance carriers and employer clients. Primary care-led health plans require stronger, more accessible provider relationships – reducing the likelihood of ER visits and other downstream costs.

A unifying theme among these alternatives is greater flexibility and – most importantly – a more engaged employee. This is a growing need in today’s marketplace. More than ever, people want to play a more active role in managing their care. Utilization of AI-powered tools, like ChatGPT, are increasingly serving as a first line of defense for clinical questions and care navigation. At the same time, players like biopharmaceutical companies and care management providers are entering the direct-to-consumer space in new and innovative ways.

Health plan design must also evolve to meet this new reality. Employers want to direct their populations to higher-quality and more affordable care. When this happens, better outcomes follow. Utilization of Embold’s Provider Guide (a Quantum Health asset) helped large, self-insured companies – covering over 325,000 employees – cut costs by nearly 5.5% per member each year. To put that into perspective, if an employer has 10,000 employees and spends $10,000 per member annually, they could save $5.5 million with Embold.

Scaling this type of work will require a more concerted focus on bringing new health plan options into the ecosystem. Variable copay plan design is one key opportunity.

Unlike traditional plans with high deductibles, variable copay plans offer set, transparent prices for specific services. In other words, patients can compare costs side-by-side when choosing where to go for care and are incentivized to make smarter, more cost-effective decisions.

These plans have been more commonly deployed and utilized across Medicare Advantage, but because they’ve shown progress in improving health care decision-making – the employer market is now taking notice.

This is something employers have long desired: Arming employees with upfront price transparency and genuine choice before they access care. Adoption is accelerating for that reason. Roughly seven percent of large employers are offering these plans in 2026, and another 20% are actively considering them.

Variable copay plans are just one solution, but they represent exactly the kind of structural innovation this market needs.