Employers Projecting Costs to Increase 7.2% Next Year; Nearly Two-Thirds Expect to Increase Employee Share of Premiums
MyHealthGuide Source: National Business Group on Health Survey, 8/18/2011, www.businessgrouphealth.org
WASHINGTON, DC — With the cost of employee health care benefits expected to increase next year at more than twice the rate of inflation, large U.S. employers are planning to have workers share more of the cost next year, according to a new survey by the National Business Group on Health, a non-profit association of 329, mostly large employers.The survey, based on responses from 83 of the nation’s largest corporations, was conducted in June, 2011.
Survey findings
- Employers estimate their health care benefit costs will increase an average of 7.2 % in 2012.
To help control those increases and begin driving down costs to avoid the Cadillac tax, employers are planning to use a wider variety of cost-sharing strategies for next year.
- 53% of respondents plan to increase the percentage that employees contribute to the premiums.
- 39% plan to increase in-network deductibles.
- 23% plan to increase out-of-network deductibles.
- 22% plan to increase out-of-pocket maximums.
“Employers are facing a multitude of challenges posed by rising health care costs, the weak economy and the financial and administrative impact of complying with the new health reform law,” said Helen Darling, President and CEO of the National Business Group on Health. “As a result, employers are being much more aggressive in their use of cost sharing techniques and cost control programs, and are making certain that employees have more reasons to be cost-sensitive health care consumers.”
- 73% will offer employees at least one consumer directed health plan (CDHP) in 2012, a sharp increase from 61% that offer a plan this year.
- 17% will have or move to a total replacement consumer directed health plan in 2012.
- The most common type of CDHP plan is a high-deductible health plan with a health savings account (75%).
- 57% provide employees’ spouses and domestic partners access to telephonic or online weight management coaches
- 54% provide access to online weight management tools.
Changes as a Result of Health Care Reform
Respondents were asked what changes they made or are planning to make as regulations from the Patient Protection and Affordable Care Act continue to come into effect. The survey found the following:
Annual Benefit Limits
- 59% are not making any changes for 2012, (full restrictions on benefit limits will be banned in2014).
- 27% are making changes to annual limits for preventive and wellness services.
- 14% are making changes to annual limits for mental health and substance abuse services.
Grandfather Status
- 23% will have at least one benefit option that keeps its grandfather status in 2012
- 19% will drop its grandfather status.
- 49% did not have any benefit option in grandfather status this year.
Default Plan for New Hires
- 27% plan to use their least costly health plan for employees as their default plan for new full-time hires as required.
- 19% plan to use the least costly plan for employers as the default plan.
About the National Business Group on Health
The National Business Group on Health is the nation’s only non-profit organization devoted exclusively to representing large employers’ perspective on national health policy issues and providing practical solutions to its members’ most important health care problems. The Business Group helps drive today’s health agenda while promoting ideas for controlling health care costs, improving patient safety and quality of care and sharing best practices in health benefits management with senior benefits, HR professionals, and medical directors from leading corporations. Business Group members, which include 66 Fortune 100 companies, provide health coverage for more than 50 million U.S. workers, retirees and their families. visit www.businessgrouphealth.org.
Comments