SURVEY SAYS: How Is Your 2010 Health-Care Rate?

While there have been signs that the rate of increase is, well, stabilizing, there doesn’t seem to be much hope that, in the absence of plan design changes, workplace health care costs are actually going to decrease.  

This week I asked readers to share what’s happened/happening with YOUR health care costs for 2010.  

Well, recent reports have suggested that there had been some leveling in the rate of increase (which, I might add, is not the same thing as a leveling in the rate) – but for a plurality of this week’s respondents ( 34.5% ), that rate of increase is more than 7%.

On the other hand, nearly as many – 30.9% – say the increase would be 1%-5%, while 18.2% say their costs will increase by 5%-7%.  

Consider that 7.3% say costs will be flat, and more than 9% indicated that their healthcare costs will actually decline.

I also asked readers if, other things being equal, employees would have to pay more, and the most common answer - 46.4% - said, "yes, a little."  

However, after that, there was no true consensus.   Nearly 16% said that they wouldn't pay any more, while roughly 11.6% said they would have to pay a lot more, and 13% said employees would have to pay more, but that the impact 'varies widely."   Oh, and 13% said they weren't sure.

Program Changes

Just over half ( 52.3% ) said they had implemented program changes (such as wellness, fitness incentives, etc.), including:

• One of our plans offers a payment up to $200 if you incorporate suggested lifestyle changes. There are also discounts for exercise classes, massage therapy, weight management programs and LASIK surgery. One other new benefit is the bicycle commuting reimbursement.
• Plan design differentials (coinsurance/OOP) based on whether or not an employee participates in wellness programs, in addition to premium differentials for participation and smoking/nonsmoking.
• Wellness initiative & some design changes
• Increased wellness incentives, increased Rx co-pays.
• Our company continues to financially support programs like Weight Watchers, smoking cessation etc. while also providing education and paid time during work hours to participate in wellness programs.
• We have become 100% fully self insured.
• Medical Clinic on-site for employees. The clinic provides routine medical care and wellness programs. Increasing deductibles and out-of-pocket maximums on our "richest" medical plan
• Wellness Discount - for non-smoking and wellness check up on annual basis
• More wellness awareness. Flu shot clinics, general health improvement lunches.
• We added a lower premium, higher deductible option.
• Wellness program tied to annual scoring by outside firm. Declining to participate of failing to meet objectives of annual review, (without medical certification to outside firm) result in higher employee contribution rates
• Name it we've tried it.
• Instituting an HSA; increasing the deductible for one option; dropping from 3 to 2 options
• We are implementing Voluntary Benefits.
• Exercise classes,

• Employees have to start paying part of the premium this year.
• We've enhanced our wellness program with more incentives for those that have chronic conditions, are pregnant or if they get their wellness exam through their physician.
• $0 generic copays for five categories of drugs, specialty drug management, step therapy for leukotrienes, eliminated fully insured HMOs - replaced them with self-insured EPOs.
• More wellness incentives with a mandatory health survey.
• Increasing deductibles and copays
• Quit smoking program
• Health assessment program
• Wellness newsletter
• Health Assessment, Points for achieving wellness activities, etc.
• Removal of fixed co-pays for office visits, replaced with coinsurance and deductible for office visits
• Payment of preventive services and colonoscopes at 100%, no deductible
• Elimination/consolidation of the number of plan options
• We intent to implement the Biggest Winner (rather than the biggest loser) on January 1, 2010.
• Change in some co-pays
• We already have wellness incentive and bring in a wellness coach who conducts monthly workshops.
•   A comprehensive wellness initiative that asks employees to manage their health or their health care costs. Those who actively participate in the wellness program by completing three requirements (health screening, health risk assessment, and being tobacco free or participating in our tobacco cessation program) have access to all the medical plan options the company offers. Those who don't complete the requirements only have access to a plan with higher deductibles and co-pays. So far, we've seen tremendous success and have high hopes that as employees get healthier over time by mroe actively engaging in their health, our medical costs will decrease.
• In the beginning stages of a wellness program. Hoping next year to make it a bit more robust. Also will be having a health fair and providing on-site flu-shots this fall.
• Regular tweaks that happen every year about what is covered; Nothing major though.
• Discounts for completing Personal Health Analysis and additional credit for completing a program.
• Wellness Program In House Clinic
• Per our doctor, we are on an exercise routine, and sensible eating diet.

• Wellness newsletter
• Health Assessment, Points for achieving wellness activities, etc.
• Removal of fixed co-pays for office visits, replaced with coinsurance and deductible for office visits
• Payment of preventive services and colonoscopes at 100%, no deductible
• Elimination/consolidation of the number of plan options
• We intent to implement the Biggest Winner (rather than the biggest loser) on January 1, 2010.
• Change in some co-pays
• We already have wellness incentive and bring in a wellness coach who conducts monthly workshops.
•   A comprehensive wellness initiative that asks employees to manage their health or their health care costs. Those who actively participate in the wellness program by completing three requirements (health screening, health risk assessment, and being tobacco free or participating in our tobacco cessation program) have access to all the medical plan options the company offers. Those who don't complete the requirements only have access to a plan with higher deductibles and co-pays. So far, we've seen tremendous success and have high hopes that as employees get healthier over time by mroe actively engaging in their health, our medical costs will decrease.
• In the beginning stages of a wellness program. Hoping next year to make it a bit more robust. Also will be having a health fair and providing on-site flu-shots this fall.
• Regular tweaks that happen every year about what is covered; Nothing major though.
• Discounts for completing Personal Health Analysis and additional credit for completing a program.
• Wellness Program In House Clinic
• Per our doctor, we are on an exercise routine, and sensible eating diet.
• Added to wellness programs, increased some incentives.
• We are planning several changes. Adding a wellness program is a must. We just changed brokers (yesterday) and will begin a total review of our benefit package with our new broker.

As for general comments about this year's enrollment process - there was a lot of interesting input/insights, ranging from the reader who said simply "It was tough" to the more colorful "Our mules don't like carrots or sticks!"   Of course, one reader doubtless spoke for many when they observed, "We completed our strategy work and were going to make big changes but then we put it on hold due to the pending Healthcare Reform."  

As did the reader who noted, "With all the commotion about health care reform, substantial decreases in pay and the recession, we feel our employees have given up enough already. When we look at benefit renewal, we will be very cautious about adding to the burden our employees already bear."

Some other observations:

• Due to the number of changes and cost increase, this will be an "active" enrollment - no defaults.
• We are self insured and negotiations very competitive this yr. Last minute revision from one of the bidders got them the contract. Did not change TPA but they did negotiate better ppo premiums for us and decreased their fees a small amt.
• Gets later at our place every year. We don't know what changes will be made for 1/1 yet let alone what employees will pay. But a mid-year change 7/1/09 lowered our costs. (Of course the 1,295 fired since last fall helped as well.)
• Because our loss ratios have gone in the wrong direction this past year in spite of the increased investment and focus on wellness, we choose to change our very generous plan designs to more reasonable levels (meaning increase co-pays and deductibles) in order to keep premiums flat. That way, those who choose unhealthy behaviors and therefore have a higher use of the benefit will be impacted by increased out of pocket costs, but those who engage in healthy behaviors will not. We were candid in disclosing our reasons for the decision, and so far, have heard very little grumbling.
• Painful internally. Such a big issue yet sr. management took three months to decide. When the CEO summers on the Cape everything falls about...it's crazy.

• Reinsurance went up much more than we were expecting - premiums increased about 12%.
• We offer two PPO plans to our associates. We have been strategically moving associates from the richest plan to a more "practical" plan with higher deductibles and out of pocket costs thru significant increases in the per-pay premiums charged to participants. Last year, 800 associates moved from our Elite plan to our Smart Choice plan, in part because Elite premiums rose 9% and Smart Choice remained flat. This year, Elite participants will again experience a 9% rate increase and Smart Choice participants will see no premium increase. For 2009, our participation in the plans is almost 50/50.
• Instituted a higher deductible plan with lower employee contributions
• We started with an increase of almost 6% but were able to keep it flat by introducing an HSA and dropping to one option. Employees who are large users of health insurance services will pay more as they use those services. A few employees will pay more for the option they choose but for the most part, the amount withheld from paychecks will be close to the same as last year which was our goal.
• We're self funded so it's all about our own experience with health care claims. The biggest issue is getting senior management to make decisions on programs for the new year.
• We are a July 1 Plan Year and it went well - eliminated two plans and added coverage for domestic partners. The imputed income on the rate sheets threw everyone a curve. Lesson Learned: for the less than 200 employees/retirees that added domestic partners, imputed income information will be on the website, not in the rate sheets!
• Grim--the carriers have cut support to a minimum so any request or negotiation takes inordinately long--pricing to market is all too common--insurers seem to forget that their job is to balance risk, not totally avoid it.
• Limited choices and more out of pocket expenses. I may end up choosing the high deductible plan with low premium and contribute the maximum each year to a health savings account.
• Still in process.

• We've already doubled our deductible and hope that our wellness initiative helps but probably won't enjoy the results (if any) until 2011.
• Am concerned, because our employees have already had their wages frozen and have taken a cut in pay, so I hate the thought of increasing their cost to health insurance. We are an older population, so I guess its to be expected that rates will climb as utilization increases.
• Use of the Wellness Program and In House Clinic could result in a rate reduction or flat line for 2011 but we still see it as only a temporary fix.
• The Doctors and Hospitals are still driving the bus, and the rest of America is just along for the ride. The Carriers can't afford to have gaping holes in their networks, so they can only negotiate so far. The best they can hope for is to attempt to moderate the increases, but Medical Inflation is still out of control. I haven't heard of a flat provider contract renewal in over 20 years, even after an extended period of network disruption.   I frequently hear them crying crocodile tears about how tough they have it, but for some strange reason none of them live in my neighborhood. At the end of the day, it must not be too bad a gig.

There was quite a bit of variation in the experiences (and/or anticipated experiences) of this week's respondents:

One reader noted that "Our self-insured plans went down (woohoo!) but our HMO plans went up by about the same."   Another said they were looking at "A modest 2% increase! Whoo hoo!", and another said "Ours went through the roof at 29% increase!"   That paled in comparison to the reader who said "We're looking at a 40% increase--ouch!!"   Another said that they "Don't have the quote back yet, but anticipating an increase."

Many, of course, were (still) in the camp of the reader who said "Don't know yet. Our carrier hasn't released our renewal rates and probably won't for another week or so. This makes things a little tight in planning our health care program for 2010. We are planning on a major restructure (if I have my way) of our benefit program."

But this week's Editor's Choice goes to the reader who colorfully explained "Ouchy wowwa! Initial renewal report 19.69%. Management outraged. Huge cuts imminent. Send help!"