High-cost claims were once considered outliers in employer health plans. Today, they are increasingly becoming a significant driver of employer healthcare spending. As these claims grow in frequency and cost, they threaten the sustainability of employer-sponsored insurance by driving up premiums, increasing cost-sharing for employees, and reducing the predictability of year-to-year healthcare spending.
While fully insured employers do not absorb these costs directly, they experience their impact through rising premiums as insurers spread risk across employer groups. For self-insured employers, the financial risk is more immediate. Large claims directly affect the employer’s health plan spending.
High-cost claims are typically defined as any claim exceeding $100,000 in a single calendar year. However, the scale of these claims is increasing rapidly. Since 2021, the number of million-dollar claims has increased by approximately 61%.1 Although high-cost claims represent only about 1-2% of health plan members, they account for roughly one-third of total healthcare spending.2 These claims are often driven by factors such as catastrophic health events, complex chronic conditions, high-cost medications, and rising healthcare prices
A single cancer diagnosis, premature birth requiring neonatal intensive care, or use of a new gene or cell therapy can dramatically reshape an employer’s health plan financial picture. As innovative but expensive treatments continue to enter the market and healthcare prices continue to rise, employers must proactively identify strategies to mitigate the impact of high-cost claims.
For employers, especially those that self-insure, the question is increasingly not if a high-cost claim will occur, but when. Proactive planning is essential. Employers that adopt strategies to identify risk early, improve care management, and evaluate high-cost services can better manage spending while ensuring employees and their families maintain access to high-quality care.
The Kentuckiana Health Collaborative (KHC) supports employers in addressing these challenges. In September 2025, KHC partnered with the National Alliance of Healthcare Purchaser Coalitions to host a high-cost claims workshop for employer members. Through this workshop, employers:
- Gained insight into their high-cost claims
- Defined best practice strategies for managing high-cost claims
- Determined effective interventions to comprehensively address challenges
Through technical assistance, peer learning, and collaboration, employers left the workshop better prepared to manage the growing challenge of high-cost claims.
Building on this work, KHC will convene a High-Cost Claims Roundtable Series in 2026. This series will allow employers to continue learning from peers while navigating the ongoing complexity of implementing cost management strategies.
The series will begin with a data deep dive, helping employers ensure they have timely and actionable claims data. Participants will explore how to identify high-cost claims, understand their primary drivers, evaluate potential waste, and use data to guide targeted interventions. Subsequent sessions will focus on condition-specific strategies, examining key drivers of high-cost spending such as oncology, neonatal care, cardiovascular conditions, and specialty medications.
High-cost claims are not something employers must simply react to. The trends driving these claims, including rising healthcare prices, the growth of specialty medications, and the emergence of advanced therapies, are well established and likely to continue. By taking proactive steps today, employers can better manage financial risk, protect the affordability of coverage, and ensure their employees have access to high-quality care.
Participation in this roundtable is for KHC Employer Members only. Employers or public purchasers that provide healthcare benefits and are interested in participating can contact Natalie Middaugh, President and CEO of the KHC, at nmiddaugh@khcollaborative.org to learn more about how you can get involved.
1Sun Life. (2025). High-cost claims and injectable drug trends analysis. Sun Life Assurance Company of Canada. https://sunlife.showpad.com/share/Gb0BkRezYAJKrLV7vUkz4?WT.mc_id=en-us:pr:mediarelease:press-release:2025-hccr:pdf-generi
2Springbuk. (n.d.). Managing high-cost claims: Strategies for employers. Springbuk. https://www.springbuk.com/blog/managing-high-cost-claims/
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Review other KHC resources on topics related to high-cost claims. Note: many resources are available to KHC members only.
