Benefits April 18, 2001

Workers Likely To Pay Higher Share of Healthcare

April 18, 2001 (PLANSPONSOR.com) - Mercer's latest National Survey of Employer-Sponsored Health Plans shows that health benefit costs for active employees increased by 8.1% in 2000, outpacing the Consumer Price Index by 2.5%.
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The survey of 3,300 companies found that:

  • the number of employers who will increase employee contributions increased to 40%, up from 21% in 1999
  • while 17% will increase cost sharing, up from 9% in 1999

The increase in the price of prescription drugs was found to be a major component of medical plan cost increases. In 2000 the size of this component increased by 17%.

At the same time:

  • co-payments for generic drugs rose from $7 to $8,
  • while brand name drug co-payments rose from $14 to $16.

In addition, the downward trend in retiree medical coverage continued in 2000. The percentage of future retirees covered has dropped at a rate of about 2% every year since 1993.

The survey also found that while more small employees were shopping for cheaper plans, with 38% of them offering HMOs in 2000, up from 33% in 1999, the increase in enrolments in HMOs for large employees increased by only 2%.

Data collected in the survey points to the following trends in the future:

  • Employers will share more of the cost with their employees
  • Employers will search for new cost control methods, making better use of the internet and e-health programs and encouraging more employee involvement.

 

 

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