The HŪMNZ Element: Issue 21 - The Benefits Questions Every CFO Should Be Asking

💡Editor’s Note

Benefits decisions increasingly sit at the intersection of Finance, Care, and workforce strategy.

Costs are rising. Employees are feeling affordability pressure. Leaders are being asked to protect the employee experience while maintaining financial discipline.

That creates a difficult choice when benefits are viewed only as an expense.

Should the company absorb the increase?
Shift more cost to employees?
Reduce coverage?
Remove programs?
Consolidate vendors?

The better starting point is not simply deciding where to cut.

It is understanding what the organization is buying.

Some Care investments may reduce absence, support retention, improve access, or help employees remain productive. Others may be underused, poorly communicated, duplicative, or disconnected from workforce needs.

The CFO’s role is not to evaluate every benefit individually. It is to ensure the portfolio is producing enough workforce and business VALŪE to justify the spend.

The Core Question
Are we measuring benefits cost, or benefits performance?

A benefits budget can grow while employee value remains flat.

A program can show low utilization because it lacks relevance. But low utilization can also mean employees cannot find it, understand it, afford it, or trust it.

A cost reduction can improve the budget this year while creating higher absence, turnover, or employee cost pressure later.

This is why benefits should be reviewed as a portfolio of workforce investments.

The financial question is not only:

How much are we spending?

It is also:

What risk is the spend reducing, what outcome is it supporting, and what would happen if it disappeared?

Four Questions for the CFO Agenda

1. What is driving the increase?

Mercer projects that average employer health benefit cost will exceed $18,500 per employee in 2026, representing a 6.7% increase. The firm points to higher utilization, specialty medications, behavioral health demand, and broader medical-cost pressure as contributing factors.

VALŪE lens: A percentage increase does not identify the source of the problem. Leaders need to separate price inflation, utilization, plan design, population risk, and vendor performance.

CFO question: Which cost drivers are structural, and which can be influenced through better Care design, navigation, or purchasing?

2. What are employees paying for the benefit?

KFF reported that the average annual premium for employer-sponsored family coverage reached $26,993 in 2025, with employees contributing an average of $6,850. The average deductible for single coverage among workers in plans with general deductibles was $1,886.

VALŪE lens: A benefit can be expensive for the employer and still feel unaffordable to the employee. That weakens perceived value and may lead people to delay Care.

CFO question: Are cost-sharing decisions protecting the budget while unintentionally reducing access, trust, or utilization?

3. Are employees using the right Care at the right time?

Utilization is not simply a volume metric.

Higher usage may indicate better access to preventive or behavioral health support. It may also reflect worsening population needs or unnecessary high-cost Care. Low usage may signal a healthy workforce, or a benefit that employees cannot navigate.

VALŪE lens: The goal is not maximum utilization. It is appropriate utilization that improves access, reduces avoidable risk, and supports workforce continuity.

CFO question: Are we measuring utilization by service, workforce segment, outcome, and cost, or only reviewing a portfolio-wide participation rate?

4. What business outcome is the investment protecting?

Benefits accounted for 30.1% of private-industry employer compensation costs in March 2026, according to the Bureau of Labor Statistics.

Gallup also estimates that low employee engagement cost the global economy $10 trillion in lost productivity in 2025, reinforcing the financial importance of workforce conditions that support performance and commitment.

VALŪE lens: Benefits represent a significant share of total compensation. They should be evaluated alongside retention, absence, productivity, employee risk, and the cost of replacing critical talent.

CFO question: Which benefits protect measurable business outcomes, and which remain disconnected from operating priorities?

Stat of the Week

30.1%

Benefits represented 30.1% of private-industry employer compensation costs in March 2026.

For CFOs, this is the scale of the decision.

Benefits are not a peripheral HR expense. They are a major workforce investment that influences affordability, employee trust, Care access, retention, productivity, and financial risk.

The opportunity is not simply to spend less.

It is to know which dollars are protecting VALŪE and which are not.

Is your benefits portfolio answering the right financial questions?

Before the next renewal, redesign, or cost-reduction decision, ask:

What is driving cost?
Who is using the benefit?
Who cannot access it?
What risk is it reducing?
What business outcome is it protecting?
What would happen if we removed it?

A stronger benefits strategy connects Care spend to employee experience and business performance.

That is how Finance moves from managing benefits cost to managing benefits VALŪE.

To explore how HŪMNZ helps leadership teams evaluate Care and benefits through utilization, risk, productivity, and EBITDA, reach us at [email protected].

Until next time,

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