The Rising Cost of Diabetes — and Why Employers Can’t Ignore It Anymore

Diabetes has become one of the most costly and fast-growing chronic conditions affecting employer healthcare budgets, making diabetes claims reduction wellness programs more essential than ever. For mid-size and enterprise employers, diabetes-related claims represent a substantial and rising share of annual spending — a trend that continues to intensify.

According to the Centers for Disease Control and Prevention (CDC), more than 38 million Americans have diabetes, and an additional 97 million adults have prediabetes, most of whom are unaware of their condition (CDC, National Diabetes Statistics Report 2024). The CDC also confirms that 1 in every 4 healthcare dollars is spent on diabetes care, including both direct medical costs and reduced productivity.

Employer impact is significant. The American Diabetes Association (ADA) estimates that people diagnosed with diabetes generate 2.3 times higher medical costs compared to those without the condition, including an annual $9,601 per employee in direct medical expenses (ADA, Economic Costs of Diabetes in the U.S., 2022).

Yet the most important insight — and the largest opportunity — is this:
Up to 70% of Type 2 diabetes cases can be prevented or delayed through lifestyle change, according to CDC research from the National Diabetes Prevention Program.

This is precisely why diabetes claims reduction wellness programs are becoming a top strategic priority for both employers and TPAs. Prevention and early intervention represent one of the largest untapped cost-saving opportunities in population health. TPAs are uniquely positioned to lead this shift by implementing diabetes claims reduction wellness programs that surface risk earlier, address lifestyle-driven root causes, and support employees in making sustainable behavior changes.

Wellness programs are no longer “feel-good” add-ons. They are proven tools for slowing disease progression, reducing high-cost claims, and delivering measurable financial and health outcomes — particularly for employers seeking long-term strategies to stabilize healthcare spending.

Why Diabetes Has Become Such a Cost Driver for Employers

To understand why wellness programs are essential for reversing the trend, it’s important to understand why diabetes drives employer costs so aggressively.

1. It’s Often Diagnosed Late

Many employees with prediabetes don’t know they have it. By the time a diagnosis appears in claims data, the disease has already progressed — along with its cost.

2. It Comes With Multiple Comorbidities

Diabetes rarely exists in isolation. It commonly co-occurs with:

  • hypertension
  • obesity
  • kidney disease
  • cardiovascular issues
  • neuropathy
  • depression
  • MSK pain

This multiplies claims and accelerates cost growth.

3. It Requires Continuous Treatment

Diabetes management involves:

  • medications
  • glucose-monitoring supplies
  • lab work
  • specialist visits
  • potential complications and ER visits

This makes it one of the most expensive lifelong conditions for employers.

4. It Reduces Productivity

Diabetes leads to:

  • absenteeism
  • fatigue
  • frequent breaks for glucose monitoring
  • higher risk of injury
  • presenteeism

According to the ADA, employers lose $90 billion annually in reduced productivity related to diabetes.

Why Wellness Programs Are One of the Most Effective Diabetes Prevention Tools

Most diabetes risk factors are deeply tied to daily habits — habits that wellness programs are designed to improve.

Wellness programs reduce diabetes-related claims because they address four core areas:

  1. Behavior change
  2. Early detection
  3. Lifestyle improvement
  4. Ongoing support and accountability

Claims data reveals the disease.
Wellness data predicts and prevents it.

Here’s how.

Wellness Programs Identify Rising-Risk Individuals Long Before Claims Data Does

The earliest warning signs of diabetes are behavioral, not clinical.

Wellness programs use real-time signals like:

  • decreased activity
  • poor sleep
  • increasing stress
  • weight gain patterns
  • sedentary work habits
  • nutrition struggles
  • burnout

These patterns appear months or years before diabetes shows up in medical claims.

TPAs and employers can use this data to intervene early — stopping risk from escalating into chronic disease and high-cost claims.

Wellness Programs Drive Lifestyle Changes That Directly Reduce Diabetes Risk

Lifestyle changes are the most powerful tool for diabetes prevention. Wellness programs help employees adopt behaviors that dramatically reduce risk:

1. Increased Activity

The CDC reports that losing just 5–7% of body weight through increased movement reduces diabetes risk by up to 58%.

Wellness programs drive movement through:

  • walking challenges
  • habit tracking
  • team-based activities
  • daily step goals
  • micro-movement reminders

2. Better Nutrition Habits

Nutrition education and simple tracking tools help employees:

  • reduce sugar intake
  • manage portion sizes
  • choose lower-glycemic foods
  • improve meal patterns

This directly influences glucose regulation.

3. Weight Management Support

Sustainable lifestyle changes are more effective — and far less costly — than GLP-1 medications for many employees.

Programs that pair movement, nutrition, and stress reduction produce measurable weight loss, lowering diabetes risk dramatically.

4. Stress and Sleep Management

Chronic stress elevates cortisol, which impairs glucose control.

Poor sleep is also directly linked to insulin resistance.

Wellness programs that target sleep, resilience, and emotional wellbeing are essential components of diabetes prevention.

Wellness Programs Improve Preventive Care Compliance

A major driver of diabetes claims is failure to:

  • get annual exams
  • complete A1C screenings
  • participate in early risk programs
  • follow preventive care recommendations

Wellness platforms increase compliance by:

  • sending reminders
  • incentivizing screening participation
  • integrating preventive care goals into wellness challenges
  • rewarding members for completing health tasks

When employers improve preventive care compliance, they catch diabetes earlier — before it becomes expensive.

Wellness Programs Reduce the Severity and Cost of Existing Diabetes

For employees with diabetes, consistent wellness support helps reduce complications, emergency visits, and medication escalation.

Wellness programs help diagnosed members:

  • improve glucose stability
  • maintain healthy weight
  • increase activity safely
  • reduce stress and comorbidities
  • improve medication adherence

These improvements reduce downstream costs such as:

  • hospitalizations
  • neuropathy treatment
  • advanced medication regimens
  • dialysis
  • cardiovascular complications

A landmark study published in The Lancet confirmed that lifestyle programs outperform medications alone in improving long-term diabetes outcomes.

How Wellness Programs Help Employers Control GLP-1 Demand

GLP-1 drugs work — but their cost is staggering.
A lifestyle-first wellness strategy helps employers:

  • reduce the number of people progressing to high-risk obesity
  • delay or avoid the need for GLP-1 prescriptions
  • improve outcomes for people who transition off GLP-1s
  • support weight maintenance and relapse prevention
  • reduce pharmacy costs long-term

When wellness programs reduce diabetes risk and improve metabolic health, fewer employees require expensive pharmaceutical interventions.

Why Wellness Programs Work Especially Well for Mid-Size and Enterprise Employers

Different-sized employers experience the benefits of wellness programs in distinct ways — but the ROI exists at every level.

Mid-Size Employers (500–5,000 employees)

  • Claims volatility is higher due to smaller population size
  • A single diabetes-related hospitalization can significantly impact budgets
  • Wellness programs stabilize risk and reduce high-cost outliers
  • Leadership often seeks wellness programs for retention and culture advantages

Enterprise Employers (5,000+ employees)

  • Large populations allow for measurable population health improvements
  • Wellness programs reduce aggregate cost trends
  • Even small improvements in risk level produce millions in annual savings
  • Enterprises value unified platforms and predictive analytics

For both segments, diabetes-related claims represent a solvable and preventable financial burden.

Why TPAs Should Lead the Wellness-Driven Diabetes Prevention Strategy

TPAs are uniquely positioned to make wellness-driven diabetes prevention a core part of their value proposition.

TPAs see the claims impact every day.

They know where trends are worsening — and why.

TPAs can connect wellness data to claims outcomes.

This is the holy grail for employers.

TPAs influence employer benefits decisions.

When TPAs recommend prevention, employers listen.

TPAs benefit from lower volatility in claims.

Fewer catastrophic cases = happier employers = higher retention.

TPAs can differentiate in RFPs

“Wellness as a cost-saving strategy” stands out immediately.

Prevention isn’t just good for the employee.
It’s good for the TPA business model.

What Effective Diabetes Prevention Programs Must Include

TPAs should ensure any diabetes-focused wellness program includes:

  • lifestyle coaching
  • nutrition education
  • movement and walking challenges
  • stress and sleep support
  • weight management tools
  • burnout and resilience training
  • real-time data reporting
  • preventive screening reminders
  • personalized health journeys

When these components work together, measurable change occurs.

Woliba’s unified wellness platform helps TPAs:

Identify Rising Risk Early

Through real-time behavioral and engagement data.

Deliver Personalized Prevention Journeys

Covering nutrition, activity, weight, stress, sleep, and resilience.

Increase Participation Through Challenges and Recognition

Turning lifestyle change into a social and rewarding experience.

Improve Screening and Preventive Care Compliance

Using nudges, reminders, and incentives.

Report Measurable Outcomes to Employers

Including:

  • movement increases
  • weight improvements
  • stress reduction
  • A1C screening participation
  • diabetes-risk reduction metrics

Woliba gives TPAs a prevention engine that reduces diabetes risk long before claims appear.

The Bottom Line: Diabetes Risk Is Preventable — and Wellness Programs Make It Possible

Mid-size and enterprise employers are looking for partners who can help them reduce diabetes risk and the crushing costs associated with it. Wellness programs offer the most effective — and most scalable — method for preventing diabetes, improving health outcomes, and reducing claims.

TPAs who embrace a prevention-first strategy will:

  • help employers lower costs
  • improve employee health
  • strengthen client relationships
  • differentiate in the TPA marketplace
  • deliver measurable ROI year over year

Wellness is no longer optional.
Prevention is no longer optional.
Reducing diabetes-related claims starts with the right wellness program — and the right TPA partner to deliver it.