Three members of Harvard’s University Benefits Committee, which is responsible for evaluating and advising on Harvard’s healthcare plans, shared their insights on the current state of the healthcare marketplace and how Harvard’s health plans can remain comprehensive, competitive, and fiscally sustainable in the face of rapidly rising healthcare costs.

In this edited conversation, the Gazette spoke with Daniel Carpenter, chair of the UBC and Allie S. Freed Professor of Government; Leemore Dafny, Bruce V. Rauner Professor of Business Administration and Howard Cox Health Care Initiative faculty co-chair at the Harvard Business School and professor of public policy at the Harvard Kennedy School; and Michael Chernew, Leonard D. Schaeffer Professor of Health Care Policy in the Department of Health Care Policy and director of the Healthcare Markets and Regulation Lab at Harvard Medical School.

---

What are some of the changes employees will see in the Harvard health plans for the upcoming year?

Carpenter: Harvard has not adjusted the proportion of healthcare costs paid by Harvard and the employee for 10 years, despite rapidly rising healthcare costs. Therefore, after a series of conversations with the community and recommendations to University leaders, we are beginning the process of making modest adjustments to co-payments (co-pays) and deductibles on a more regular basis. These adjustments will help make sure that the proportion of costs paid for by Harvard and our members stays roughly stationary in the face of rapidly escalating costs and supports the long-term sustainability of Harvard’s healthcare plans. These changes will also allow for better financial management and greater predictability for both Harvard and plan members.

So how, exactly, does this translate in terms of impact to Harvard employees?

Dafny: The adjustment of co-pays and deductibles means that some employees will see slight increases in cost-sharing, which is an umbrella term for co-pays, deductibles, and other out-of-pocket expenses. Harvard has kept those dollar amounts constant for a decade, a decade that has seen both general inflation and, more importantly, very steep growth in healthcare costs. 

Carpenter: But we should also add that because of our out-of-pocket maximums, there’s only so much that any employee will pay annually. And those caps on total out-of-pocket spending continue to be low.

Will there be any changes to covered services in 2026?

Dafny: The University is not making any changes to the plans themselves. We offer very generous insurance plans with a comprehensive set of covered benefits. Our members will continue to have access to their providers, clinicians, and care teams with whom they have established relationships.

Chernew: The health plans will continue to include coverage for preventive care services, chronic care, and many other specialized services. We will continue to have premiums structured by salary range to help ensure that coverage remains accessible for all. Our healthcare plans will continue to have low caps on out-of-pocket spending, similar to plans offered by our Ivy+ peer institutions.

Carpenter: These changes are really about making some minor adjustments that, over time, will allow us to keep these platinum-level, world-class health plans with world-class healthcare for years, even decades to come.

Why is Harvard making these changes now?

Carpenter:  The UBC initially began the process of reviewing Harvard’s healthcare plans about four years ago when it became clear that we, as a nation and as a University, would be facing some real challenges around the cost of healthcare in the years to come. The dramatic increase in costs has been driven in large part by the advent of so many new and expensive life-saving treatments and technologies. Every employer, in every part of the country, has been dealing with these kinds of challenges.

Chernew: Healthcare spending for Harvard and in Massachusetts — and for the country as a whole — has been increasing very rapidly, approaching double digits. With cost trends rising quickly, Harvard intends to stabilize our plans after keeping cost-sharing amounts relatively unaltered for almost a decade. So, it’s really a matter of keeping our plan designs in balance with national healthcare spending trends and competitive relative to the employer peer set.

What guiding principles shaped the UBC’s recommendations this year?

Chernew: The UBC’s goal is to ensure that we can offer Harvard employees a fair and comprehensive benefits package with access to high-quality care while also ensuring that our healthcare benefits are fiscally sustainable in the long run.

Carpenter: The UBC thought very hard about how these changes will affect our different employee populations. Harvard has a rich diversity of employees at many different stages of life and with a wide variety of healthcare needs. Harvard’s health plans operate on the principle that members pay a small share of their healthcare expenditures through premiums, which are adjusted by salary tiers, as well as through co-pays and deductibles, which are capped at an out-of-pocket maximum. This is a very progressive system.

We know that healthcare is incredibly expensive. When illness happens or chronic conditions arise, they can be debilitating — physically, obviously, but also mentally, emotionally, and financially. We wanted to pursue a policy that, whatever changes we made, would avoid overburdening those who need the most care or who have fewer resources.

With these changes, are Harvard’s plans still competitive? How does our health plan compare to those offered by Ivy+ peers and other leading employers?

Carpenter: The federal government classifies healthcare plans by the range of benefits they offer and by what is called the plan’s “actuarial value.” Basically, the actuarial value of a plan is the percentage of total covered healthcare services that the plan pays for, with the rest paid by the employee.

Even with these changes, Harvard continues to offer platinum-level plans with actuarial values above 90 percent. The average for U.S. private employers is in the low to mid-80s.

How are the needs of employees in lower salary grades and those who require care for serious or chronic medical conditions considered in these updates?

Carpenter: In our recommendations, we sought to minimize the impact of the changes as much as possible for those in our community who need healthcare the most. In other words, members and families who reach the out-of-pocket maximum every year will be the least impacted by changes to the cost-sharing structure.

Dafny: I want to add that the UBC did not make these recommendations lightly. We consult regularly with internal and external benefits experts who advise us on developments in the healthcare landscape so that we can continually improve the offerings of our health plan, whether it’s challenges associated with the shortage in primary care physicians or access to mental healthcare for adolescent patients, for example. We try to be really attuned to the needs of our community and work closely with our health insurers to ensure we are doing our best to address those needs.

Our out-of-pocket maximums remain low to reduce the financial burden on those who need healthcare the most. And the University continues to offer programs to reimburse eligible employees for cost-sharing expenses.

What resources will be available to help employees understand these updates and prepare for Open Enrollment?

Carpenter: Going into Open Enrollment this year, Harvard Human Resources’ Benefits Office will be holding a series of benefit fairs where you can get information about the healthcare plans, get help comparing plans, and ask specific questions. These fairs will be open to all University employees. We continue to have excellent online resources with plan options, plan comparisons, and updated Frequently Asked Questions.

Dafny: Before the Open Enrollment period, the Benefits Office sends all employees a guide or brochure outlining the different plans, the rates for the next year, and additional information. For more of the fine print, you can go online and access it there readily.

You can always reach out directly to the staff at the Benefits Office as well, at any time. They are very knowledgeable and very responsive in answering any questions.

---

Open Enrollment this year will be from Oct. 28-Nov. 6. Watch your email in early October for a link to your guide, or visit: harvie.harvard.edu/open-enrollment-2026 for additional information.