Healthcare actuary and financial risk manager Milliman is launching a pair of ETFs that it says will let advisors and their clients tap into the rising cost of healthcare.
The funds are designed to generate returns that generally correlate with the healthcare cost changes for an average individual utilizing an employer-provided health plan in the U.S.
The Milliman Healthcare Inflation Guard ETF (Ticker: MHIG) aims to meet the cost of healthcare inflation, while the Milliman Healthcare Inflation Plus ETF (Ticker: MHIP) is targeted at approximately 2% above the cost of healthcare inflation.
“What we’re trying to target is something that doesn’t go down that much, which is healthcare cost inflation,” Adam Schenck, principal & managing director, Fund Services, at Milliman, told InvestmentNews. “These [ETFs] are multi-asset across equities that are primarily in the healthcare sector, then we have a liquid alts bucket, where we primarily use gold, but have the flexibility for other liquid assets.”
Fixed income, primarily treasures, are also a feature of the ETFs, according to Schenck.
The ETFs harness Milliman’s Health Trend Guidelines, which the company produces in its capacity as a healthcare consultancy. The Guidelines are a series of indexes on the cost, utilization, and unit costs of healthcare services, and are used by insurers, healthcare providers, and employer health plans.
Hans Leida, principal and consulting actuary at Milliman, told InvestmentNews that Milliman gets information on approximately 35 million insured lives in the U.S. every month, which represents about 20% of the commercially insured population.
“We used a lot of that experience to develop this strategy,” added Schenck.
Milliman says that investors or their advisors could allocate to the Inflation ETFs in their Health Saving Account (HSA), 401(k), and/or individual retirement accounts (IRAs).
HSA assets soared to $159 billion across 40 million accounts by the middle of last year, according to data from Devenir, marking 16% year-over-year asset growth. Devenir, which provides investment solutions for HSAs, says that investment assets drove the expansion, rising 30% year over year to $73 billion.
The ETF market is also booming. The global ETF marketplace now stands at $19.85 trillion, a $4.9 trillion increase from the end of 2024, according to State Street’s 2026 Global ETF Outlook. In the U.S. alone, ETF assets are projected to approach $20 trillion by 2030, according to State Street.
Milliman has also launched a Retirement Healthcare Cost Calculator, a free tool that it says will help advisors and individuals understand the potential healthcare costs they may face in retrirement.
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