Report Foresees Steep Healthcare Increases

August 9, 2002 (PLANSPONSOR.com) - If insurer projections are accurate, plan sponsors could still be looking at some hefty healthcare increases this year and next, according to a new survey.

Buck Consultants’ national survey of more than 80 U.S. health insurers, HMOs, and third-party administrators now projects that costs will rise 14-15% over the next 12 months for the most popular medical plans, including notable increases from the last time the consulting firm took the system’s temperature.

According to Buck, preferred provider organization (PPO) costs will rise 14.8%, down just 0.1% from the last reading.  However, costs for the fast-growing point-of-service programs are now estimated at 14.6%, up from 14.0% in the prior survey.  Health maintenance organizations (HMOs) are also projected to suffer a significant increase, from 13.0% to 13.8%.

Prescription drug card programs are still looking at significant increases, but less so than in the prior evaluation. 

Pharmacy benefit managers are now “only” projected for a 15.9% increase, down from the 16.3% reading in the prior survey, while insurers are now looking at a 20.6% increase, down from 22.3%, and combined programs are now estimated to be heading for a 16.9% increase that is 1.5% lower than the prior survey.

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