Milliman’s New ETF Prescription for Rising Healthcare Inflation

Why It Matters

These ETFs give both insurers and retirees a market‑based hedge against accelerating health‑care costs, addressing a gap that traditional equity or bond portfolios cannot fill.

Key Takeaways

• Healthcare inflation outpaces overall CPI, threatening retirees' savings.
• Milliman launches two ETFs targeting health cost trends.
• ETFs blend treasuries, gold, S&P 500, and healthcare stocks.
• MHIG tracks guidelines; MHIP adds extra equity exposure.
• Both institutional insurers and individual investors are target users.

Summary

Milliman, the leading healthcare actuary, announced two new exchange‑traded funds—MHIG (Guard) and MHIP (Plus)—designed to help investors offset the faster‑than‑inflation rise in medical costs.

The firm argues that traditional CPI measures miss utilization spikes and service‑mix changes, so it built “Milliman Health Trend Guidelines” that translate actuarial data into asset‑allocation signals. The ETFs combine short‑term and intermediate Treasuries, gold, modest S&P 500 exposure, and a core of healthcare equities.

Joe, Milliman’s spokesperson, cited recent pharmaceutical price surges, especially GLP‑1 drugs, as a driver for heavier pharma weighting. MHIG aims to track the guidelines, while MHIP adds extra equity tilt to potentially outperform the baseline.

By offering a hedge against health‑care cost inflation, the funds give insurers a tool to manage liability risk and give retirees a way to protect purchasing power, potentially reshaping how the market prices inflation‑linked assets.

Original Description

Traditional portfolios often fail to protect investors from ballooning healthcare inflation. Joe O’Malley, External Senior ETF Salesperson at Milliman Financial Risk Management, talks the two ETFs the firm is bringing to market to address this pain point shared across investors of every type.

With healthcare inflation doubling broad inflation over the last two decades, the cost to investor portfolios is sizable. Milliman applies its expertise as a leading healthcare actuary to finding the specific and evolving pain points for investors, and working to alleviate them. The two impending funds, the Milliman Healthcare Inflation Guard ETF (MHIG) and the Milliman Healthcare Inflation Plus ETF (MHIP), will offer potential solutions for institutional as well as individual investors.

DISCLOSURE

The recipient should not construe any of the material contained herein as investment, hedging, trading, legal, regulatory, tax, accounting or other advice. The recipient should not act on any information in this document without consulting its investment, hedging, trading, legal, regulatory, tax, accounting and other advisors. Information herein has been obtained from sources we believe to be reliable but neither Milliman Financial Risk Management LLC (“Milliman FRM”) nor its parents, subsidiaries or affiliates warrant its completeness or accuracy. No responsibility can be accepted for errors of facts obtained from third parties.

The information, products, or services described or referenced herein are intended to be for informational purposes only. This material is not intended to be a recommendation, offer, solicitation or advertisement to buy or sell any securities, securities related product or service, or investment strategy, nor is it intended to be to be relied upon as a forecast, research or investment advice.

The products or services described or referenced herein may not be suitable or appropriate for the recipient. Many of the products and services described or referenced herein involve significant risks, and the recipient should not make any decision or enter into any transaction unless the recipient has fully understood all such risks and has independently determined that such decisions or transactions are appropriate for the recipient. Investment involves risks. Any discussion of risks contained herein with respect to any product or service should not be considered to be a disclosure of all risks or a complete discussion of the risks involved.

Carefully consider the Funds’ investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds’ prospectuses or, if available, the summary prospectuses which may be obtained by visiting www.millimanfunds.com. Read the prospectus carefully before investing.

Milliman FRM is an SEC registered investment advisor (SEC#:801-73056) since 2012. You can find Milliman FRM’s ADV filings at https://adviserinfo.sec.gov/firm/summary/159377.

Milliman Health Trend Guidelines ™ – a series of indices providing data on the cost, utilization, and unit cost of healthcare services – both in total and broken down separately for professional services, inpatient and outpatient services, as well as prescription pharmaceuticals. Data used to calculate the indices is provided by leading commercial health insurance plans and data firms that cover approximately 60 million insured individuals. Data is lagged on a trailing 3-month basis and then combined with up-to-date economic data that is correlated with the costs of healthcare noted above and used to forecast expected claims data for these services in the future. It is important to note that the indices created through the Milliman Health Trend Guidelines are not standard market indices. They do not measure the price or total return performance of securities, but rather serve as a guideline as to expected changes in the general cost of healthcare. These expected changes inform the investment process for the Milliman Health Trend Managed Accounts.

Investment Products Offered: Are Not FDIC Insured | May Lose Value | Are Not Bank Guaranteed