Tracking Healthcare Benefit Costs

December 29 01:00 2015 by ushadmin

Recent surveys from the Employee Benefit Research Institute, Mercer and others indicate that the upward pressures on healthcare benefit costs for employees may be easing. What this means for HR as they manage and communicate benefit information to employees.

In general, the surveys show that many companies expect to keep increases to 6 percent in 2016; others project keeping increases to five percent for the third consecutive year. Mercer’s National Survey of Employer-Sponsored Health Plans 2015 finds that the average health benefit cost per employee is projected to rise by less than 5 percent for the fifth straight year. And despite the decreasing cost trend, 54 percent of the companies plan to make some changes to health benefit programs in 2016.

Meanwhile, the 2015 Employee Benefit Research Institute/Greenwald & Associates Health and Voluntary Workplace Benefits Survey finds 50 percent of workers with health insurance coverage report having experienced an increase in healthcare costs in the past year, an historical low in the survey.

What has impacted this apparent slowdown in cost increases? While the move to high deductible plans is a cost-reduction driver, Brian Marcotte, president and CEO of the Washington-based National Business Group on Health, says improvements can’t be attributed to any one thing. “Companies implemented more transparency, concierge services [and] wellness programs, and helped consumers navigate their options and where to find the best places for care,” he says.

“The trend is good,” says Marcotte. “However, it’s higher than it should be, because the projection is above the Consumer Price Index of about 2 percent.”

Last year, about 50 percent of companies jumped to a full replacement with high-deductible plans, Marcotte says. “And, a third of large companies told us that the HDP was the only option offered to employees. About 27 percent of the companies surveyed are considering moving to HDP for 2017, but prefer waiting to see if any changes are enacted to the ‘Cadillac’ excise tax, a provision of the Affordable Care Act,” Marcotte adds.