According to a poll taken by Compdata Surveys of Kansas City for the Business Council of New York State Inc., seven in 10 employers experienced double-digit increases in health-care costs between April 2002 and April 2003, regardless of the type of health plan offered, according to the A.M. Best Company. The survey covered almost 250 employers.
The survey found that:
- 90% of employers offering indemnity plans paid higher premiums, with an average premium increase of 18.2%
- 88% with health-maintenance organization plans had higher premiums, with a 14% average increase
- 73% offered point-of-service plans shelled out more, with a 14.7%-average hike
- 72% going with preferred-provider organization plans experienced a jump, with a 15.5% average increase.
The increases are slightly lower than the previous year, according to Theresa Worman, director of marketing for Compdata. In 2002, the company’s survey found indemnity plans had a 19.4% increase in premiums, HMOs had a 14.8%-increase, PPOs had a 14.1%-increase, and POS plans had a 14.4%-increase.
The percentage of employers taking steps to reduce the costs is rising, as well. The survey found that eight of nine cost-cutting steps were used by a larger percentage of employers than in the previous year. For the ninth step, the percentage remained the same.
- 39% of employers said they increased the employee portion of the premium, up from 33.5% in 2002
- 27.3% increased deductible levels, up from 22.9%
- 23% increased the employee coinsurance level, up from 18.1%
- 19.8% switched insurance carriers, up from 14.4% in 2002
- 12.8% reduced benefits, up from 7.4%
- 11.2% offered a choice of deductible levels, up from 8%
- 3.7% initiated an internal claims analysis process, up from 2.7%
- 3.2% became self-insured, up from 1.6%.
The survey found that 5.3% implemented a managed-care program, the same as in the previous year.