Rising neoplasm claims are driving the cost of self-funded health plans

Advanced treatments and specialty drugs fuel high-cost claims, requiring employers to deploy proactive data strategies and stronger carrier partnerships.

Over the past year, self-insured employers, insurers and excess carriers have experienced a rise in both the frequency and severity of high-cost claims as advanced therapies and specialty drugs become more prevalent. While the increase is not attributable to any one disease, neoplasms continue to be a main contributor followed by circulatory and birth-related conditions. More commonly known as tumors, neoplasms are abnormal growths of tissue that occur when cells divide too fast or do not die when they should, and they can be benign or malignant.

According to QBE North America’s 2026 Accident & Health Market Report, neoplasms account for the highest share of claims. These conditions represent between 31% and 36% of the total stop loss claim reimbursements, the funds that stop loss carriers pay to self-funded employers to cover catastrophic medical expenses. At the $200,000 deductible level, neoplasm claim severity has risen 12% compared to the average of prior years, while claim frequency has increased by nearly 30%.

Advanced treatments are a major contributor to rising severity. The early use of specialty oncology drugs, immunotherapies, and cellular therapies has changed care into long-term medical management, creating substantial upfront and ongoing costs. For such treatments, the highest claim to date exceeded $7 million, driven by complex oncology care that progressed to transplant and advanced cellular therapy.

“We’re seeing a fundamental change in the economics of cancer care. Advanced therapies are helping patients live longer and achieve better outcomes, but they are also creating million-dollar claims that employers and health plans must be prepared to manage,” said Jesse Roderick, Head of Accident & Health Claims, QBE North America.

The financial risk to an employer varies depending on the specific type of cancer and the chosen stop loss deductible level. Common diagnoses like female breast cancer and lung cancer represent a large share of claims at lower deductibles but have less impact at higher thresholds.

For example, breast cancer accounts for 16% of cancer claims at a $100,000 deductible but drops to 3% at the $1 million level. Lung cancer drops from 10% to 1% across those same thresholds. Conversely, hematologic malignancies, which are blood cancers like leukemia and multiple myeloma, create a risk for larger claims. Blood cancers account for 18% of neoplasm claims at a $100,000 deductible but make up more than half (54%) of neoplasm claims at the $1 million deductible level.

Multiple myeloma is significant because it is often diagnosed at an advanced stage, requiring immediate and continuous systemic therapy. The combination of higher frequency and claim severity caused the blood cancer claim cost per employee per month to rise by more than 70% in 2025, with the steepest growth seen in myeloid leukemia.

High-cost claims are no longer outliers, but a routine part of corporate healthcare that self-funded employers must manage. Longer hospital stays, prolonged treatment, and specialty pharmaceuticals are changing the financial risk profile of health plans.

“As treatment pathways become more complex, employers need a proactive strategy that combines clinical oversight, data-driven decision making and close collaboration with their stop loss partners,” said Andrea McNamara, Head of Accident & Health Underwriting, QBE North America.

Plan sponsors and administrators should proactively share clinical data with stop loss partners early to identify and manage complex cases before expenses escalate. Early identification allows options such as reviewing the site of care that may significantly reduce expense while simultaneously improving a patient experience. Proactive utilization management, prior authorization, and single-case agreements for high-cost oncology treatments can reduce allowed amounts and help prevent avoidable cost escalation. 

“The opportunity to control costs often lies in visibility,” said McNamara. “When employers, administrators and stop loss carriers can identify complex oncology cases sooner, they are better positioned to guide care, evaluate treatment options, and reduce the financial impact.”

Reassessing contracts in favor of value-based payment models can make future healthcare spending more predictable. Employers should also demand better access to usable pharmacy and medical data to identify exact cost indicators, while holding vendors accountable through regular audits.

In addition, business leaders can implement analytical tools and vendor solutions that provide both early identification and management of health plan expenses. Predictive analytics can help plans spot early signs of rising claim costs, allowing companies to deploy care management and oversight on high-cost specialty drugs.

“Employers can no longer afford to review high-cost claims after treatment concludes,” said Roderick. “Access to timely clinical data, supported by predictive analytics, allows organizations to intervene earlier, direct care to centers of excellence and better manage the impact of specialty drug spending.”

Implementing strong utilization controls, directing care to centers of excellence, and reassessing provider contracts will allow businesses to better plan for and control cost acceleration while ensuring employees maintain access to vital, life-saving medical innovations and treatments.
 
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