Conducting a Health Plan Claims Analysis to Drive Strategy

Wellness Workdays
11 hours ago
6 min read

Health care claims data can look like a financial record of what has already happened. In reality, it can be one of the most useful strategic tools an organization has for deciding what should happen next.

For employers that sponsor health benefits, claims tell a story about the health of the workforce: which conditions are driving costs, where employees are using care, which problems may be escalating, and where prevention or better care management could make a difference.

That story is becoming increasingly important as health care costs continue to rise. According to KFF's 2025 Employer Health Benefits Survey, average annual family premiums for employer-sponsored health insurance reached $26,993, up 6% from 2024. Employees contributed an average of $6,850 toward those premiums. At the national level, the Centers for Medicare & Medicaid Services reported that U.S. health care spending reached $5.3 trillion in 2024, an increase of 7.2%.

For employers, simply knowing that costs are increasing is not enough. The more valuable questions are: Why are they increasing? Which conditions and services are responsible? And what can we realistically do about them?

A thoughtful health plan claims analysis can help answer those questions.

Start With the Right Question

One of the biggest mistakes in claims analysis is beginning with the data rather than the business question.

An organization might receive hundreds of pages of reports showing diagnoses, prescriptions, emergency department visits, inpatient admissions, and provider costs. The volume of information can create the illusion of insight without actually producing a strategy.

A better approach is to begin with questions such as:

What are our largest health care cost drivers?
Which conditions are increasing fastest?
Are employees receiving appropriate preventive care?
Are potentially avoidable emergency department visits increasing?
Are certain chronic conditions associated with particularly high utilization?
Are pharmacy costs changing the overall cost picture?
Which health problems present the best opportunities for intervention?

This changes claims analysis from a reporting exercise into a decision-making process.

Understand Where the Money Is Going

The first level of analysis should establish a clear financial picture.

Employers should examine total medical and pharmacy spending, per-member-per-month costs, year-over-year trends, inpatient and outpatient spending, emergency department utilization, prescription drug costs, and high-cost claimants.

Looking only at averages can be misleading because health care spending is highly concentrated.

A 2026 Peterson-KFF Health System Tracker analysis found that in 2023, just 5% of the population accounted for nearly half of total health spending. People in this group averaged $72,918 in annual health expenditures, while those in the top 1% averaged more than $150,000.

A similar pattern appears in research from the Agency for Healthcare Research and Quality. Its analysis of 2022 expenditures found that 75.1% of adults in the highest-spending 5% had two or more priority health conditions.

This matters enormously for workplace health strategy. An employer may discover that a relatively small number of complex cases are responsible for a substantial portion of spending. That does not mean the wellness strategy should simply "target expensive employees." It means the organization should understand the conditions, patterns of care, and system barriers contributing to those costs.

Move From Cost Categories to Health Conditions

The next step is identifying the clinical conditions behind utilization.

Common areas to examine include cardiovascular disease, hypertension, diabetes, cancer, musculoskeletal conditions, obesity-related conditions, behavioral health, respiratory disease, maternity, and other conditions relevant to the population.

The Centers for Disease Control and Prevention reports that 90% of the nation's $5.3 trillion in annual health care expenditures are for people with chronic and mental health conditions.

Claims analysis can make that national statistic meaningful at the organizational level.

Imagine an employer discovers that musculoskeletal claims have increased substantially over three years. Further analysis shows high utilization for back and joint problems, increasing imaging, physical therapy use, and several expensive surgeries.

The strategic response should not automatically be "launch a fitness challenge."

Instead, the employer could investigate ergonomics, workplace design, early access to physical therapy, musculoskeletal care navigation, strength and mobility education, obesity-related risk factors, provider quality, and whether employees are delaying treatment until conditions become more serious.

Claims identify the problem. Good strategy investigates the causes.

Look for Patterns, Not Just Large Numbers

A strong claims analysis examines relationships between different data points.

For example, increasing diabetes claims might occur alongside rising pharmacy spending, cardiovascular claims, obesity-related diagnoses, and emergency department utilization.

Viewed separately, these may appear to be five different problems. Viewed together, they may represent one interconnected population health challenge.

Trend analysis is especially valuable. A single year can be distorted by several catastrophic claims. Looking across three to five years helps distinguish persistent problems from temporary spikes.

Employers should also examine prevalence as well as cost. A relatively inexpensive condition affecting hundreds of employees may offer a greater prevention opportunity than an extremely costly but rare condition.

This is where claims analysis becomes more sophisticated: the goal is not merely to identify where the organization spent the most money last year. It is to identify where better health management may produce meaningful future value.

Connect Claims With Other Organizational Data

Claims become even more useful when combined with other sources of information.

Depending on privacy requirements, population size, and available data, organizations may consider aggregate information from health risk assessments, biometric screenings, pharmacy data, disability claims, workers' compensation, absence records, employee assistance programs, engagement surveys, and wellness program participation.

Suppose claims show growing behavioral health utilization while employee surveys report increasing stress and managers report burnout concerns. At the same time, EAP utilization remains low.

Together, those findings create a much stronger case for reviewing mental health access, manager training, EAP communication, workload practices, resilience resources, and the overall employee experience.

No single data source tells the entire story.

The goal should be to build a health and performance dashboard that allows leaders to see relationships among health risks, utilization, organizational outcomes, and program participation.

Turn Findings Into Priorities

Not every claims finding deserves a new wellness program.

A useful way to prioritize opportunities is to evaluate each issue across several dimensions:

Magnitude: How many employees or dependents are affected?
Cost: How much does the condition contribute to total spending?
Trend: Is prevalence or spending increasing?
Preventability: Can evidence-based prevention or early intervention make a difference?
Actionability: Does the employer have realistic ways to influence the problem?
Organizational relevance: Does the issue affect absence, productivity, safety, disability, retention, or employee experience?

Consider an organization where cardiovascular-related claims are rising and aggregate health data indicate significant rates of hypertension. Instead of simply offering another awareness campaign, the employer might build a coordinated strategy around blood pressure screening, primary care access, nutrition, physical activity, medication adherence, tobacco cessation, and follow-up for employees with identified risks.

That is a strategy built around evidence rather than a collection of disconnected activities.

Measure What Happens Next

Claims analysis should not be a once-a-year event.

Once interventions are implemented, organizations need to track whether the indicators that justified the strategy begin to change.

Measures might include participation and engagement, preventive screening rates, appropriate primary care utilization, medication adherence, condition prevalence, emergency department utilization, hospital admissions, disability, absence, and health care cost trends.

Leaders should also be realistic about timing. A wellness initiative introduced in January may not produce measurable medical cost savings by June. Some outcomes, such as participation or screening completion, can change quickly. Changes in chronic disease prevalence, complications, or total medical spending may require several years.

That is why evaluation should include both leading indicators and longer-term outcomes.

The question should not simply be, "Did health care costs go down?"

A better set of questions is: Did we reach the right people? Did behavior or utilization change? Did preventive care improve? Are health risks moving in the right direction? And are we seeing evidence that these improvements could ultimately influence cost and organizational performance?

From Claims Data to Health Strategy

Health plan claims analysis is most valuable when it leads to action.

The objective is not to create a sophisticated spreadsheet or a 100-page annual report. It is to understand the health challenges facing the workforce well enough to make better decisions.

Start with clear questions. Identify the major cost and utilization drivers. Examine conditions and trends. Connect claims with other organizational data. Select opportunities that are both important and actionable. Then measure whether the strategy changes the indicators that matter.

In an era of rapidly rising health care costs, employers cannot afford to build wellness programs based primarily on intuition, popularity, or what another company is doing.

The strongest programs begin with the needs of their own population.

Claims data can help reveal those needs. When organizations turn that information into focused, evidence-based interventions and continuously measure the results, wellness moves beyond a collection of activities. It becomes a disciplined business strategy for improving health, managing risk, and creating measurable organizational value.

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