Embracing innovation in health programs to combat risk  

Each year the members of Mercer’s Center for Health Innovation place their bets on a few big future-forward solutions and gather a select group of employers, market innovators, and Mercer subject matter experts to talk about them. Over the past few weeks, our 2025 Innovation Symposia — with sessions in New York and San Diego — showcased groundbreaking solutions that may significantly alter the landscape of employee health benefits. The discussions centered on four topics of interest and their corresponding risks and opportunities: Agentic AI, Individual Coverage Health Reimbursement Arrangements, Pharmacy Benefit Administrators (PBAs vs PBMs), and the changing climate’s impact on workforce health.

The common theme? How innovative solutions can address the mounting risks that employers face from accelerating health costs, higher employee expectations, lean HR staffs, and the threats that extreme climate poses to workforce health and well-being. While we can’t convey all the information and insights that were shared over the course of the symposium, here’s a taste:

Agentic AI: Transforming healthcare delivery

Agentic AI takes artificial intelligence systems to the next level. Whereas traditional AI must rely on predefined instructions, Agentic AI can autonomously make decisions and take actions based on its own process of data analysis. For employers, leveraging Agentic AI can lead to more efficient health benefit management, reduced administrative burdens and personalized employee health solutions. This is an emerging and rapidly evolving field, and all employers should consider working with their vendors to pilot and experiment with different use cases.

ICHRAs: A flexible approach to benefits

ICHRAs allow employers to reimburse employees for purchasing individual health insurance plans through the Affordable Care Act marketplace. Some see this defined contribution approach to health benefits as a way to provide employees with the flexibility to choose plans that best meet their needs. For employers, ICHRAs may potentially lower costs or allow for a more nuanced strategy by carving up populations into allowable groups. One major consideration for this approach is the complexity of setting funding amounts that are ACA-compliant; people may need to receive different subsidies based on where they live and the varying cost of marketplace plans. Another is ensuring that employees have the support they need to make good choices, as there is generally much more choice with different coverage and network options in the ACA market than under a typical employer offering, so helping employees navigate the nuances is key. ICHRAs may get some enhancements under the new administration, so tracking and understanding any changes could be important for companies looking to modernize their benefits strategy and expand employee choice.

Pharmacy Benefit Administrators: Navigating prescription drug costs

Pharmacy Benefit Managers play a familiar role. But what about PBAs? The distinction is in the vertical integration and ownership of various components in the PBM model. PBAs, like PBMs, play a critical role in managing prescription drug benefits, negotiating prices and ensuring access to necessary medications. However, PBAs, in contrast to PBMs, operate independently in a bring-your-own supplier fashion. With rising drug costs impacting overall healthcare expenses, employers may benefit from a PBA approach that aligns with their financial and employee health goals. By understanding the intricacies of PBA contracts and performance metrics, employers can make informed decisions that lead to better health outcomes and cost savings.

Climate health: Addressing the intersection of extreme weather and well-being

Climate health focuses on the impact of extreme weather events on individual health — physical health, mental health and financial health. As severe climate-related threats continue to pose significant risks, employers must recognize the importance of integrating climate health into their health and wellness programs. Mercer partnered with the Health Action Alliance to create The National Commission on Climate and Workforce Health — leaders with a broad range of expertise working together on tools and resources that empower employers to protect their workers from the health risks posed by extreme weather events.

In a healthcare landscape that is shifting faster than ever before, innovation is not just a trend; it’s a necessity for forward-thinking employers committed to the well-being of their workforce. By staying on top of emerging solutions, you can take advantage of opportunities to enhance employee health and satisfaction and drive organizational success — sooner rather than later.

We’d like to thank our 2025 Innovation Symposia sponsors: Capital Rx, Cascade AI, Oscar Health, and Thatch.