Of these organizations, 40% expect their overall health care costs to increase by between 1% and 5%, and another 40% expect their overall health care costs to increase by between 6% and 10%, the survey data showed. Twelve percent of these employers expect their health care costs to increase between 11% and 15%; and 8% expect an overall increase of 16% or more.
“As employers begin to plan for their 2010 health benefits, they must take the new COBRA subsidy costs into consideration,” said Tom Lerche, Aon Consulting’s Healthcare Practice leader, in an announcement. “Most plan sponsors continue to experience a 7% to 11% health care cost trend rate, so additional costs from this subsidy will impact overall health care plan strategy for 2010.”
Lerche added that Aon expects the typical 5% to 10% COBRA enrollment rate for former employees to increase to 14% to 18% as a result of the subsidy.