How Employers Are Shifting the Point of Care to Cut Costs

Employer-sponsored healthcare costs are climbing rapidly, with the average cost per employee expected to surpass $18,500 by 2026, according to Mercer’s National Survey of Employer-Sponsored Health Plans. As costs outpace budgets, many employers are looking for new ways to manage healthcare spending while maintaining access to quality care.

To address these challenges, employers are restructuring healthcare delivery, focusing on cost-effective care through alternative plan designs and employer-sponsored clinic models. By shifting care utilization away from high-cost health systems to more accessible, affordable settings, organizations aim to reduce costs while maintaining quality care.

One major strategy driving this shift is the rise of level-funded health plans, particularly among small and midsize employers. These plans bridge the gap between fully insured and self-funded models, requiring employers to pay a fixed monthly amount for expected claims, administrative fees, and stop-loss insurance. If claims are lower than expected, employers can recover a portion of the surplus, creating a clear financial incentive for better care management.

Level-funded plans also provide more flexibility in benefit design. Employers can use lower co-pays and other incentives to steer employees toward options such as outpatient clinics, ambulatory surgery centers, and virtual care, which are often less expensive than hospital-based services. According to the Kaiser Family Foundation, 37% of workers at companies with 10 to 199 employees were enrolled in level-funded plans in 2025.

At the same time, employers are investing in on-site and near-site healthcare clinics. These facilities typically offer services such as primary care, preventive care, behavioral health support, and care coordination. By providing easier access to care and helping employees manage chronic conditions, clinics can reduce costly emergency room visits and hospital stays.

Moreover, these clinics act as hubs for care navigation, helping employees connect with high-quality, cost-effective specialists, and reducing care fragmentation. This is particularly impactful in specialties where costs and quality vary significantly, offering employees better guidance for their care decisions.

For employers, the benefits of these initiatives are clear: lower medical claims, reduced absenteeism, improved productivity, and employee satisfaction. The return on investment makes these models an appealing solution amid rising healthcare costs.

Together, level-funded plans, targeted benefit designs, and employer-sponsored clinics reflect a broader shift in how healthcare is delivered and financed. As healthcare costs continue to rise, this employer-driven transformation is poised to expand further, influencing traditional health systems, ambulatory providers, and the broader healthcare landscape.

For more information on related investment opportunities and insights, read Healthcare Mosaic – Shifting Sites of Care: Evolving Industry Trends Signal Major Shift in Points of Care Delivery, published on April 22, 2026, by Ryan Daniels, CFA, partner, and group head of the healthcare technology and services sector.