Here's a number every HR director and CFO should know: claimants with $250,000 or more in annual paid claims make up less than 1% of covered individuals, yet they account for roughly 15% of total medical and prescription drug spending.  

Put simply, your plan's financial year is often decided by just a few people, usually employees or family members facing some of the hardest moments of their lives. Planning for these claims isn't only about protecting the budget. It's about making sure those members get the right care, at the right place, at a fair price.  

High-Cost Claims Are No Longer Rare

Not long ago, a million-dollar claim was a once-in-a-decade event. That's no longer the case. According to QBE's 2026 market report, the number of members exceeding $200,000 in annual claims rose nearly 20% in a single year. Meanwhile, 49% of self-funded plan sponsors now report claims over $1 million, more than double the 23% who did in 2024.  

The drivers are familiar, but they're intensifying. Cancer leads the way, accounting for 36% of all stop-loss reimbursements. Birth and NICU claims more than doubled from 2024 to 2025. Specialty drugs and heart conditions round out the list, as newer treatments extend and improve care while pushing costs higher.  

Why This Matters for Every Funding Model

No matter how your plan is funded, large claims affect you:  

• Self-Funded: If you're self-funded, they hit your plan directly, and your stop-loss coverage is what keeps one difficult year from becoming a financial crisis.  
• Level-Funded: If you're level-funded, you're in good company: 51% of covered employees at companies with 10 to 199 workers are now in a self-funded or level-funded plan, which means more small and mid-sized employers carry large-claim risk than ever before.  
• Fully Insured: And if you're fully insured, you may never see the bill, but large claims still shape how your carrier prices your coverage.  

Before the Claim: Getting Ahead of It

The good news is that high-cost claims aren't entirely out of your hands. Employers who manage them well tend to focus on a few key areas:  

• Spot them early. Many large claims begin with something visible, such as a new cancer diagnosis, a high-risk pregnancy, or the start of a specialty medication. Regular large-claim reporting from your TPA or carrier, paired with strong case management, gives you time to act and helps members get to the right care sooner.  
• Steer to the right place of care. The same treatment can cost dramatically different amounts depending on where it happens. Centers of excellence for cancer and transplants, along with home or office-based infusion instead of hospital outpatient settings, can lower costs while often improving outcomes.  
• Invest in maternity support. With birth-related claims climbing so quickly, prenatal programs that identify high-risk pregnancies early are one of the most worthwhile investments a plan can make.  
• Know your stop-loss contract. Understand how your policy treats ongoing large claims, including whether individuals can be “lasered” with a higher deductible, what renewal protections you have, and how your contract basis (such as 12/12 or 12/15) lines up with when claims are actually paid. Terms vary widely by carrier, so the details matter.  

After the Claim: Managing the Cost on the Back End

Even after a large claim arrives, there's still real money on the table. These tools apply mainly to self-funded and level-funded plans, though fully insured groups can ask their carrier which ones it uses.  

• Review the bill before it's paid. Large hospital bills frequently contain errors, from duplicate charges to incorrect coding, yet many are paid at face value under tight timeframes. An itemized bill review catches those errors before the money goes out the door.  
• Negotiate the big ones. When a claim is out-of-network or billed at full charges, a cost-containment vendor can often negotiate a single-case agreement or a reduced settlement. For predictable high-cost procedures such as transplants, some plans lock in fixed rates in advance rather than relying on a standard discount.  
• Manage specialty drugs after the prescription. Once a member starts a high-cost specialty drug, savings can still come from moving infusions to a lower-cost setting, switching to biosimilars where appropriate, and enrolling eligible members in manufacturer assistance programs. Be cautious, though, with vendors promising to “shift” specialty drug costs entirely off the plan. These arrangements can carry compliance risks and disrupt members' care.  
• Lean on your stop-loss carrier. Many stop-loss carriers give plans access to their own cost-containment vendors for complex, high-dollar cases. It's also important to submit reimbursement requests promptly and track claims against your contract's timeframes, so nothing falls outside your coverage window.  

The Bottom Line

High-cost claims are quickly becoming a routine part of running a health plan, and planning for them should be just as routine. With a few proactive steps before a claim and the right tools in place after one, employers can protect their budgets and, just as importantly, help employees get better care when they need it most.  

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