Helping Employees Navigate Rising Health Care Costs
September 27, 2023
Helping Employees Navigate Rising Health Care Costs

Employers continue to struggle with rising health care costs and providing employees with affordable and quality care options. Unfortunately, employers expect health care costs to increase significantly in 2024, according to several industry surveys and reports. These findings revealed that employers anticipate health care costs to grow between 6.5% and 8.5% in 2024, the largest increase in more than a decade. As a result, employer-sponsored health care plans may cost more than $15,000 per employee.


For the most part, employers have avoided shifting increasing health care costs onto employees due to the tight labor market and ongoing attraction and retention challenges. Despite employers’ reluctance to shift the burden of rising costs onto employees, workers will likely pay more for health care as overall medical expenses increase. Health insurance costs are already among the biggest expenses for American families; therefore, employees will likely feel increasingly stressed and burdened financially as they are forced to pay more for care. As such, employers have an opportunity to support their workers by helping them navigate rising costs.


This article provides guidance to help employers discuss increasing health care costs with their workers and aid employees in mitigating these expenses.


Why Are Health Care Costs Rising?

Health care costs have increased relatively slowly over the last few years, in part due to decreased utilization during the COVID-19 pandemic and because insurer contracts typically are not renegotiated annually. However, several market conditions have recently led to steep increases in health care costs. For example, health care utilization has rebounded, resulting in medical plan costs returning to pre-pandemic levels. Utilization has especially increased for catastrophic claims and among individuals with chronic health conditions.


Inflation is also causing health care costs to rise. Hospitals and medical providers are increasing prices to address rising employee wages and supply costs. Additionally, consolidation among hospitals, physician practices and commercial insurers has resulted in higher health care prices for insurers.


Other reasons why health care costs are expected to increase in 2024 include the following:


  • Specialty and costly prescription drugs, especially the high demand for diabetes and obesity drugs
  • Cell and gene therapies
  • Technological advancements
  • Workforce shortages


These market conditions started affecting insurance rates and contracts in 2023, and their impact is only expected to grow in 2024. As a result, increases in health plan expenses are expected to impact all employers, regardless of size and whether they are fully or self-insured.


How Employers Are Responding to Rising Costs

While some employers may pass increasing health care costs onto their employees, many employers are expected to absorb most of the higher costs to remain attractive to top talent and retain their workforce. Instead, these employers are expected to embrace cost control initiatives, such as requiring prior authorization, utilizing disease management and adding nurse advice lines. Other strategies employers will likely implement to manage rising health care costs include wellness programs; plan design initiatives (e.g., offering high deductible health plans, requiring spousal surcharges or carve-outs and conducting dependent eligibility audits); and offering telemedicine, price transparency tools and centers for excellence.


Helping Employees Navigate Rising Health Care Costs

Even though most employers will not pass rising health care costs onto employees, how employers communicate changes and information related to increasing medical costs is critical. It presents employers with an opportunity to build trust, strengthen employee loyalty and reduce the risk of turnover. Employers should consider the following strategies for communicating with employees about rising health care costs.


Establish Key Messaging

How employers communicate about rising health care costs and any benefits changes to employees can often impact whether they are understood and accepted. By keeping key messaging simple and clear, such as focusing on new or updated benefits offerings, employers can better ensure that employees understand any changes. Clear and simple messaging can be repeated often, helping to distribute important health care and benefits information to the entire workforce.


If changes to benefits plans result in increased costs or reduced offerings for employees, employers can find ways to communicate not only takeaways but also givebacks (e.g., increasing employee premium contributions but adding certain supplemental benefits, such as transportation benefits). This allows employers to demonstrate to employees what they are doing to address rising health care costs and that they are mindful of employees’ financial burden due to increasing costs. This can help organizations get employee buy-in for any benefits changes and build loyalty and trust with their workforce, which can help improve productivity and attraction and retention efforts.


Communicate Changes to Employees

As organizations make changes to their health insurance plans and offerings to address increasing medical costs in 2024 and beyond, it’s important to clearly communicate those changes to employees. Failing to do so may result in employees paying for expensive and, in some cases, unnecessary care. This may include employees going needlessly out of network to receive care, resulting in increased medical costs. With this in mind, effective employee communication can help employers with implementing cost control measures.


Select Appropriate Communication Channels

Since every workplace is different, selecting multiple communication channels that are engaging and relevant to the workforce is essential. Leveraging technology can help employers communicate frequently and effectively with employees about changes to health care costs, benefits and offerings rather than simply relying on in-person or physical communication methods. Digital channels allow employees to access information when and where they need it. Still, in-person communication, on-site meetings and physical mailers can play an important role in communicating increasing costs and benefits changes to employees as well as ensuring these changes are understood and received.


Educate Employees About Health Care Costs

Employers can educate employees on the current state of the health insurance industry and how to effectively use their health plans to avoid unnecessary or high-cost care. By focusing on educating employees about any changes and rising costs, organizations can enhance the overall effectiveness of their communication methods and increase the likelihood that employees will accept them. Employers can also give employees a breakdown of total health care premiums and the portions paid by each party to help workers understand how medical costs impact a company’s bottom line as well as the total value of the benefits provided to employees. Additionally, employers can provide tools to help employees make the most cost-effective health care decisions.


Employer Takeaway

Helping employees navigate rising health care costs is an ongoing process, but it’s essential that workers feel properly informed about medical expenses, benefits options and mitigation strategies. Establishing strategies to communicate important information regarding increasing health care costs and benefits changes is vital to the health and well-being of an organization’s workforce. As health care costs will likely increase for the foreseeable future, employers who act now to address workers’ concerns regarding rising health care costs and provide actionable solutions can improve employee retention, increase productivity, strengthen staff morale and gain a leg up on their competition.


For additional employee benefits resources, contact us today.

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Simco Insurance & Wealth Management’s 2025 Year in Review

January 7, 2026
At Simco Insurance & Wealth Management, 2025 was a year defined by refinement. Rather than chasing growth for growth’s sake, our focus was on designing better systems, improving the rhythm of our work, and removing friction from the moments that matter most to our clients. Every adjustment was made with one priority in mind: creating an experience that feels organized, responsive, and genuinely supportive for the individuals and families we serve. This recap highlights the operational progress and strategic shifts that shaped our year. For our clients, these efforts show up as clearer communication, smoother appointments, and more confident guidance. For those getting to know Simco Insurance & Wealth Management for the first time, it offers a look at how we’re intentionally preparing our team, tools, and processes to meet rising expectations with care and consistency. Designing Retention With Intention One of the most meaningful accomplishments this year was the development of an automated retention process focused on high-impact client touchpoints. By taking a closer look at recurring needs and communication patterns, the team built a system that strengthens relationships while reducing dependence on manual follow-up. This structure helps ensure consistency and follow-through, even during our busiest periods. As a result, we’re able to stay more connected, responsive, and proactive, reinforcing trust and delivering a more reliable client experience. A More Strategic Approach to AEP Planning Preparation for the Annual Enrollment Period (AEP) 2026 began earlier and more strategically than ever before. In September, the team launched a strategic early booking initiative, starting one full month ahead of the industry norm. The goal was twofold: maximize retention of existing clients while preserving capacity to support new business. The outcome exceeded expectations. More than 75% of existing clients were booked before AEP officially began , creating breathing room, reducing pressure, and allowing agents to focus fully on each client interaction. Just as importantly, this initiative produced a measurable, repeatable system that can be refined and reused for future AEP cycles. Visibility That Drives Accountability To support better planning and performance, the team developed a Book of Business Tracker that provides real-time visibility into client retention and new enrollments. This tool created clearer accountability for agent performance while also improving forecasting and decision-making throughout AEP. With better data came better conversations, better pacing, and more confident leadership. Communication and Automation That Protect Relationships Clear, timely communication is essential during periods of change. In 2025, the team produced and automated targeted emails for clients losing their plans, ensuring they were informed early and guided through next steps. These systems helped protect client relationships, reduce uncertainty, and reinforce Simco’s reputation for calm, proactive service, even in complex or time-sensitive situations. Reimagining the Client Appointment Experience Much of the year’s progress focused on improving the flow and efficiency of daily client interactions. The scheduling process was redesigned to eliminate bottlenecks, overlapping appointments, and unnecessary delays. The result was a smoother daily rhythm, shorter wait times, and a noticeably calmer office environment. Additional improvements included: Creating cubicle-based laptops to help clients complete CareValue forms efficiently Developing confirmation emails with embedded surveys so clients can submit doctors and medications in advance Tracking visits versus enrollments to ensure clients move fully through the process Together, these enhancements cut average appointment time by 50% , effectively doubling agent capacity while preserving quality and care. Strengthening Data Accuracy and Operational Support Behind the scenes, the team focused on maintaining clean, reliable data by entering missing client information and policy details on behalf of agents when needed. Repetitive processes were streamlined through automation and shared resources, reducing friction and freeing agents to focus on client relationships rather than administrative tasks. Every workflow was designed with scalability in mind: systems that can be replicated, measured, and improved year after year. Working on the Business, Not Just in It Throughout 2025, the Simco Insurance & Wealth Management team embraced the Traction principle of working on the business, not just in it. Continuous improvement, team empowerment, and thoughtful system design guided every decision. Each change reinforced Simco’s Core Values and Vision, ensuring that every client touchpoint reflects consistency, clarity, and care. Our Path Forward Into 2026 The work completed this year has created a stronger foundation for what’s next. With smarter systems, clearer data, and a more intentional client experience, we are positioned to serve individuals and families with even greater confidence in 2026 and beyond at Simco I&WM. Thank you to our clients for your trust, and to our team for the dedication and care that made this progress possible. We’re so proud of what we’ve built, and even more excited about where we’re headed! This year-in-review report was developed by Shena Edington-Bright, Team Lead at Simco Insurance & Wealth Management.

Simco’s 2025 Year in Review

January 5, 2026
As the business landscape continues to evolve, so does Simco. While 2025 may have looked like a year of quiet focus from the outside, it was anything but. Behind the scenes, our teams were strengthening the systems and structures that support our HCM / payroll, benefits, HR, retirement, and commercial insurance services, all with one goal in mind: to deliver a smoother, more dependable, and more proactive client experience. This recap offers a high-level look at what we’ve been building. If you're part of our existing client community, you’ll see how these investments enhance the service you receive every day. And for prospective partners and the broader market, consider this a window into how Simco is evolving to meet the growing expectations of the modern employer. A Stronger Foundation for the Future Much of our work throughout 2025 focused on reinforcing the operational backbone of Simco: the processes, tools, and training that enable our teams to support clients with consistency and confidence. We refined and standardized the core elements of our service model, including: Onboarding processes: creating a smoother, more predictable start for new clients by clarifying steps, responsibilities, timelines, and handoffs, ensuring everyone begins their Simco partnership with full visibility and support. Day-to-day service workflows: enhancing how requests are managed, tracked, and communicated so that clients experience faster responses, fewer delays, and a more proactive approach to problem-solving. Renewal experiences across multiple service lines: strengthening the structure behind annual renewals so they are more organized, timely, and transparent, with clearer communication and better preparation on both sides. By strengthening the infrastructure that supports every client interaction, we’re ensuring that growth never comes at the expense of quality. Communication That Sets Clear Expectations One of the most meaningful shifts this year came from improving the clarity and cadence of communication. Whether you're a current Simco client or exploring us as a potential partner, you’ll see a growing emphasis on: Setting expectations early: ensuring clients understand timelines, responsibilities, next steps, and key milestones upfront so there’s no confusion as projects or service requests move forward. Addressing issues proactively: identifying potential challenges before they surface, communicating them quickly, and offering solutions early to prevent disruptions. Creating more transparency in every interaction: providing clearer insights into processes, status updates, and decision-making so clients always know where things stand and what’s happening behind the scenes. This work helps eliminate surprises and creates a smoother, more predictable experience. Technology That Makes Service Smarter 2025 also brought strategic technology upgrades designed to improve accuracy, efficiency, and visibility. Some key milestones include: Expanded use of integrations and automations across platforms like isolved Enhanced reporting and improved data accuracy New tools to support onboarding, renewals, and Open Enrollment The build-out of our new CRM, rolling out to employees in January 2026 For our existing clients: this CRM will evolve into a client-facing portal, giving you clearer insight into service activity and easier access to support without compromising security or simplicity. This investment underscores our long-term commitment to transparency and service innovation. A More Coordinated Open Enrollment Season The Simco Benefits Team completed Open Enrollment two weeks faster than the previous year, thanks to strengthened planning, better communication, and tighter internal coordination. This improvement reflects our broader goal: to create processes that scale with growing demand while remaining predictable and client-centered. A Strategic Shift: Separating Our B2B and B2C Divisions In 2025, we completed the structural separation of our consumer-facing services, Simco Insurance & Wealth Management, from our core B2B operations. This was not simply an internal reorganization, but a strategic step toward honoring the very real differences between the needs of businesses and the needs of individuals and families. Employers require scalable systems, predictable processes, and deep operational support. Individuals, on the other hand, seek personalized guidance, protection, and long-term financial clarity. By creating space for each division to develop independently, we positioned both sides of our organization to serve their audiences with greater intention and expertise. As our service offerings have expanded, so has the complexity of the problems we solve. The separation enables our B2B team to focus fully on the demands of an employer environment, including compliance, data accuracy, HR workflows, benefits strategy, service scalability, and beyond. At the same time, the B2C division can continue developing its advisory capabilities, client education tools, and one-to-one support models. Both sides continue to share the same core values, high standards, and service philosophy, but each now has the room to innovate in ways that make the most sense for the communities they serve. We want to ensure that whether you’re engaging with Simco as an employer, or with Simco Insurance & Wealth Management as an individual or family, you’re connected to a team built specifically for your needs without losing the warmth, consistency, or integrity that define the Simco brand. Growing Without Losing What Makes Us, Us 2025 was a year of meaningful expansion for Simco through new partnerships and client relationships. But growth alone isn’t the metric we celebrate, it’s sustainable growth. Behind the scenes, we focused on building structure and scalability so that every new relationship receives the same level of attention and consistency our long-standing clients expect from us. What This Means for Those We Serve Whether you're already part of the Simco family or seeing us for the first time, here’s what our 2025 investments translate to: More consistency in how we serve Greater proactivity in identifying and addressing issues Enhanced accuracy and efficiency throughout every process Improved capacity to support continued growth and complexity A stronger, smarter foundation for the years ahead To our current clients: thank you for trusting us with your business. Everything we built this year was designed to enhance the experience you rely on. To those learning about Simco for the first time: consider this a preview of the service structure we believe all employers should expect, both today and in the future. Looking Ahead to 2026 We’re entering the new year with momentum, clarity, and a renewed commitment to continuous improvement. The work we completed in 2025 positions us to deliver an even more streamlined, transparent, and dependable experience in 2026 and beyond. Thank you for being part of our journey and for giving us the opportunity to support yours. This year-in-review report was developed by Elisha Everson, Director of Operations at Simco.

IRS Mileage Rate Changes for 2026: What Employers Need to Know

January 5, 2026
As of January 1, 2026, the IRS mileage rate for business use officially increased. Understanding how the 2025 and 2026 rates differ, and how they apply to your organization, can help ensure compliance, accurate reimbursements, and clearer communication with employees. What Is the IRS Mileage Rate? The IRS mileage rate is a standardized per-mile amount used to calculate the deductible cost of driving for business, medical, or charitable purposes. For employers, the rate is most often used as a benchmark for reimbursing employees who use their personal vehicles for work. While private employers are not legally required to reimburse at the IRS rate, it is widely adopted because it: Provides a consistent and defensible reimbursement standard Simplifies expense reporting and payroll processing Helps avoid taxable income issues when reimbursements exceed IRS limits The IRS Mileage Rate Change for 2026 The IRS announced on December 29, 2025, that the standard mileage rate for business use increased for 2026, while the rate for medical use decreased slightly. 2026 IRS Mileage Rates Business use: 72.5 cents per mile Medical use: 20.5 cents per mile Charitable use: 14 cents per mile This represents a 2.5-cent increase for business miles compared to 2025. The IRS cited higher overall transportation costs, including fuel volatility, vehicle maintenance, insurance premiums, and depreciation, as key drivers of the increase. How the 2025 and 2026 Rates Compare For reference, here are the IRS mileage rates that applied during 2025: 2025 IRS Mileage Rates Business use: 70 cents per mile Medical use: 21 cents per mile Charitable use: 14 cents per mile To put the change into perspective: An employee who drove 10,000 business miles in 2025 could deduct or be reimbursed $7,000 That same mileage in 2026 equates to $7,250 While the difference may seem modest, it adds up quickly for organizations with sales teams, field employees, or frequent travel. What This Means for Employers For employers, the updated mileage rate affects more than just reimbursement amounts. It has implications for payroll accuracy, tax treatment, and employee expectations. Key considerations include: Reimbursement policies: If your organization uses the IRS rate, systems and policies should reflect the 2026 update. Tax compliance: Reimbursements above the IRS rate may be considered taxable income for employees. Budgeting and forecasting: Higher reimbursement rates can impact travel and operating expenses. Employee communication: Clear guidance helps avoid confusion when rates change year over year. Employers that rely on consistent processes and accurate data will find it easier to manage these changes smoothly. Are Employers Required to Reimburse at the IRS Mileage Rate? One of the most common questions employers have is whether they are legally required to reimburse employees at the IRS standard mileage rate. The short answer is no. The IRS mileage rate is not a mandate for private employers; it is a guideline used to determine how much mileage reimbursement can be treated as non-taxable. Employers are free to set their own reimbursement rates based on internal policy, budget considerations, or role-specific needs. That said, the IRS rate often serves as a practical benchmark. Reimbursing at or below the IRS rate allows employers to treat the reimbursement as non-taxable income for employees, provided proper documentation is maintained. If an organization chooses to reimburse above the IRS rate, the excess amount may need to be treated as taxable wages and included in payroll. Because of this, many employers adopt the IRS rate as a simple, defensible standard that balances fairness to employees with tax and compliance considerations. Why the IRS Adjusts the Mileage Rate Each Year The IRS calculates the standard mileage rate using nationwide cost data from the prior year. Factors considered include: Fuel prices Vehicle maintenance and repair costs Insurance premiums Depreciation and financing costs Broader transportation cost trends In recent years, rising vehicle ownership costs and inflation have pushed rates higher. The 2026 increase reflects continued pressure in those areas and is intended to better align the rate with real-world driving expenses. Best Practices for Managing Mileage Reimbursement To stay compliant and reduce administrative burden, employers should consider: Maintaining clear mileage reimbursement policies Requiring proper documentation of business purpose and mileage Using digital tools or systems that simplify tracking and reporting (such as GPS-based mileage tracking apps, expense reporting platforms, HCM technology with integrated reimbursement workflows, and mobile tools for real-time trip logging) Reviewing reimbursement rates annually to align with IRS updates Accurate mileage tracking not only supports compliance, but also protects both the employer and employee in the event of an audit. Final Thoughts Mileage rates will continue to change as transportation costs evolve. Staying informed, updating policies proactively, and ensuring systems are aligned helps employers avoid surprises and maintain trust with employees. If you have questions about how mileage reimbursement impacts payroll, tax treatment, or employee policies, Simco is here to help. You can click here to get in touch with one of our specialists today.

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