Health-care cost-shifting, -sharing to continue in 2011
Nearly two-thirds of employers plan to increase health coverage cost-sharing next year for things such as deductibles, co-pays, and out-of-pocket maximums, according to a new Aon Consulting survey.
An Aon news release said the poll also found that 57% of companies will ask employees to contribute more for the overall cost of health care in 2011. On plan design (e.g., deductibles, co-pays, and out-of-pocket maximums), 46% of employers are shifting costs to employees equal to the overall renewal increase, while an additional 46% are shifting costs to workers that are less than the overall renewal increase.
For overall health-plan cost, 40% of employers say the additional worker contributions will be equal to the 2011 renewal increase, and 49% indicate that workers will be asked to pay less than next year’s renewal hike.
According to the announcement, the poll also found an increase in monthly COBRA contributions for terminated employees.
The average monthly cost for employee-only HMO coverage for a terminated worker is $429 this year, compared with $399 in 2009. For employee plus family, the former employee is paying $1,251 a month this year, compared with $1,171 per month last year. As for PPO coverage, the average monthly cost for employee-only coverage is $449 in 2010, compared with $439 in 2009, and for employee plus family, the cost tops out at a monthly average of $1,310 this year, versus $1,275 last year, Aon said.
“The increased frequency and duration of COBRA use is creating a significant strain on the program, leading to higher costs,” said John Zern, Executive Vice President and Health & Benefits Practice Director with Aon Consulting, in the news release. “Those who are unemployed, and facing uncertainty about employment prospects and future COBRA availability, are utilizing the program more than we’ve traditionally seen to treat a variety of conditions prior to potentially losing coverage. This, coupled with the high unemployment rate, is placing the COBRA program in a unique and unprecedented position.”
Aon Consulting surveyed 1,079 employers nationwide in its 2010 Benefits Survey.
More information is at www.aon.com/2010survey.