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Sponsored by: Community Health Options
Updated: August 26, 2025

Navigate the perfect storm driving health benefits costs

How does Maine’s population impact health care costs?

Maine’s population—with a median age of 45—is older than the national average, with a higher percentage of people over 65, according to Consumer Affairs, creating more demand for health care. Notably, 90% of the $4.5 trillion spent on health care in the U.S. pays for treating chronic conditions. In Maine, our older profile directly impacts these costs: 15% of residents ages 45 to 64 have three or more chronic conditions. Finally, 40% of Maine’s residents rely on rural hospitals, and with fewer patients getting treatment than at a busier hospital, everyone pays more for care. Recent closures and service reductions have contributed to delayed care, resulting in costlier treatment.

How do macroeconomic factors contribute to rising costs?


Nancy Connelly, Director of product development at Community Health Options

The COVID-19 pandemic created a ripple effect, leading to delayed care, making manageable conditions worse and treatment more expensive. For example, in 2021, the American Cancer Society linked $1.2 billion in additional treatment costs to later-stage cancer diagnoses resulting from postponed screenings. Growing reliance on high-cost specialty drugs, along with in-demand GLP-1 drugs for diabetes and weight-loss, drives spending, too. In 2023, these drugs accounted for 54% of the $770 billion spent on medications according to a Congressional report. Legislative policies also play a role as new mandates inevitably influence premiums.

Which factors affect how health insurers determine pricing for employer health plans?

Community Health Options prices small groups (with 50 or fewer members) based on the plan they select and community rating factors, including geographic rating area and the average age of the group’s eligible plan participants. Rates for large groups are based on experience, with underwriting based on past claims, potential risks based on health conditions and employee demographics.

Do health insurers do anything to help lower costs for employers and their employees?

Insurers play a key role in lowering healthcare costs. Community Health Options, for example, works with willing providers and health systems to secure rate improvements across a full range of services, including low copays for X-rays, advanced imaging and labs. It also offers access to urgent care with lower copays to help Members avoid costly emergency room visits for non-emergencies. To manage specialty prescription costs, the company promotes using biosimilar medications and offers low copays for generic drugs. The company also works with employers to build wellness programs and encourage Members to use their preventive benefits, keeping them healthier and reducing healthcare spending for everyone.

How can employers limit their healthcare costs?

Choosing the right carrier and health plan helps attract, care for and retain employees. If employees all live in Maine, a plan with a robust Maine-based network may be more cost-effective than a national option. A high-deductible health plan compatible with a health savings account can also reduce costs and help employees save pre-tax dollars for care. Regardless of the plan, teaching employees about their benefits and using population health data to target wellness efforts—such as offering nutrition programs if diabetes or heart issues are common—can improve outcomes.