2025 Employee Benefits: Who Pays the Price in a Deregulated Future?

As 2025 approaches, the future of employee benefits feels more uncertain than ever. Shifting policies, workforce expectations, and economic pressures are likely to shake things up and employers may be left wondering how to balance costs while still offering benefits that employees actually want and need. Let’s dig into some predictions on how this changing landscape could reshape some of the most talked-about benefits and who’s likely to pay the price.

Potential Changes to IVF Coverage Under a Trump Administration

One of the more controversial aspects of employer-sponsored benefits is fertility support, including In Vitro Fertilization (IVF) coverage. In recent years, an increasing number of companies have expanded their benefits to include fertility treatments, recognizing the importance of supporting employees who wish to grow their families. There have been mixed messages on IVF coming from Trump before his election and during his previous presidency. However, given Trump’s previous views on healthcare and potential policy shifts, IVF coverage could be at risk if certain protections are rolled back.

The Trump presidency might deprioritize federal advocacy for reproductive health, influencing the cultural narrative around fertility and reproductive benefits. This could lead to less societal pressure on employers and insurers to offer fertility benefits. Additionally, policies perceived as less supportive of LGBTQ+ family-building or alternative paths to parenthood might discourage momentum for expanding fertility coverage mandates at the state level.

Additionally, the Trump administration’s past focus on deregulation and cost-cutting in healthcare could influence the landscape for fertility benefits. While IVF coverage is not federally mandated, state-level laws requiring infertility treatment coverage have gained traction, particularly for fully insured plans. If a Trump presidency reduces federal support for broader healthcare funding or policies, that could leave the door open for state policies to follow suit.

For employees, losing access to employer-sponsored IVF coverage could mean paying out of pocket for treatments that can cost upwards of $15,000 to $30,000 per cycle when factoring in all medications and other expenses (often requiring multiple attempts).²,5 Without support from their employers, many families could face significant financial burdens, limiting their options for starting or expanding their families.

With rising healthcare costs and shifting workforce priorities, do you see fertility benefits like IVF as a long-term commitment for your organization, or are they at risk of being scaled back? 

Reevaluating Paid Leave Support in a Shifting Regulatory Climate

The landscape of paid leave and childcare support in the United States is at a crossroads. While more employers have embraced family leave policies to attract and retain top talent, particularly during and after the pandemic, the future of these benefits remains uncertain. Under a Trump presidency, family-focused benefits could face significant challenges as business-friendly policies emphasizing deregulation and cost containment take center stage.

Unlike other developed countries, the U.S. lacks a federally mandated paid family leave policy. Instead, it relies on the Family and Medical Leave Act (FMLA), which provides up to 12 weeks of unpaid, job-protected leave for eligible employees. This patchwork framework leaves access to paid leave largely at the discretion of employers or dictated by state mandates, such as those in California, New York, and Washington. Currently, only 25% of U.S. workers have access to paid family leave,⁴ a benefit that has become a critical tool for employers looking to attract a diverse workforce.

The Biden administration has pushed for expanded federal paid leave programs, but legislative gridlock has stalled progress, and a renewed Trump presidency could further derail these efforts by focusing on cost-saving measures for businesses. Without federal action, disparities in access to paid leave could widen, particularly for low-wage workers and those at smaller companies. States with robust paid leave programs, often reliant on federal funding like Medicaid or workforce development grants, could struggle to maintain or expand these initiatives if funding priorities shift. Additionally, a more business-friendly administration might entertain calls to loosen FMLA requirements, potentially reducing job protection obligations and increasing the risk for employees who need to take leave.

Would a shift in federal priorities lead your organization to reduce, maintain, or expand its paid leave offerings? Are you planning to make any changes to your family leave benefits in anticipation of regulatory shifts?

From Standard Packages to Flexible, Tailored Solutions

Beyond healthcare, companies are increasingly exploring Lifestyle Spending Accounts (LSAs) to meet employees’ diverse needs in a flexible and personalized manner. Rather than designing a voluntary benefits/perks offering that includes every carrier, vendor, and resource under the sun (which can be onerous to communicate and maintain), LSAs provide a flexible budget for employees to allocate toward a wide range of lifestyle expenses that align with their individual priorities. For example:

• Fitness and Wellness Programs – Supporting diverse wellness activities beyond traditional gym memberships.

• Mental Health and Personal Development – Covering options like mindfulness apps, or creative hobbies.

• Student Loan Repayment and Continuing Education – Helping employees with student debt or funding further education and certifications.

• Family and Caregiving Support – Assisting with childcare and eldercare costs.

• Sustainable Living and Green Initiatives – Subsidizing eco-friendly choices like electric bikes or home energy improvements.

• Pet Care and Pet Insurance – Covering expenses for veterinary care, insurance, and pet wellness.

• Travel and Work-Life Balance – Supporting employees in achieving a healthier work-life balance through travel or remote work setups.

Historically, employers have taken pride in offering “comprehensive benefits programs,” boasting an array of perks and voluntary benefits. However, there is a clear shift toward a more modern approach.

According to a recent SHRM report, 73% of employees expressed a preference for benefits they can personalize, reflecting a growing desire for autonomy in their benefits choices.² This change is particularly appealing to younger employees, who prioritize mental wellness, financial assistance, and flexible support over traditional benefits like life insurance.

How has your company embraced flexibility in your benefits offering? What has been the response from your employees?

How Changes to the ACA Could Drive Adoption of ICHRAs

Employer-sponsored healthcare coverage has traditionally been a cornerstone of employee benefits, with approximately 49% of Americans receiving their health insurance through their employer. However, with a second Trump administration potentially revisiting efforts to roll back key provisions of the Affordable Care Act (ACA), employers may be prompted to rethink their approach to healthcare benefits. 

During Trump's previous term, there were attempts to relax the ACA's mandates requiring businesses with 50 or more employees to offer health insurance. If ACA standards are relaxed, such as loosening what counts as compliant coverage or reducing the penalties for non-compliance, ICHRAs could expand further as a less regulated, lower-cost alternative. Employers might see them as a way to offer some level of coverage while shifting decision-making and financial responsibility to employees. 

ICHRAs, introduced in 2020, let employers provide a fixed allowance for employees to buy health insurance on the individual market. By late 2023, over 11 million employees were covered under these plans.¹ This model gives employers budget control and flexibility, making it attractive to small and mid-sized businesses. However, it shifts financial and decision-making responsibility to employees. In high-cost areas, individual plans can be pricier, leading to higher out-of-pocket costs and a more complex selection process.

Is your organization considering ICHRAs to manage healthcare costs amid potential ACA changes? How do you ensure that employees aren’t overwhelmed by the increased complexity of choosing their own insurance?

Closing Thoughts: Preparing for the Unpredictable Future of Benefits

Change is the only constant in the world of employee benefits. As we head into 2025, employers must prepare for a future that is both unpredictable and full of opportunity. Now is the time to rethink strategies, embrace flexibility, and commit to a benefits approach that supports both the organization and its people.

Do you need help optimizing and future-proofing your employee benefits strategy? We are here to help. Get in touch. 

Footnotes

1. U.S. Department of Health and Human Services (2023). ICHRAs: Adoption and Impact Report.

2. Society for Human Resource Management (SHRM) (2024). Employee Preferences in Benefits Offerings.

3. Gallup (2023). Flexibility and Personalization in the Workplace: A Generational Analysis.

4. Bureau of Labor Statistics (2023). Access to Paid Leave in the U.S.

5. GoodRx (2024). How Much Does IVF Cost?