Employers Are Skeptical that their Health-Care Strategies Will Really Pay Off

By Staff Report

Sep. 10, 2004

Companies are implementing a potpourri of strategies to reduce health-care costs, but their effectiveness is questionable, according to a study by the Kaiser Family Foundation.

Only 15 percent of employers rate disease management as “very effective” at controlling health insurance costs. Similarly, only 11 percent say that consumer-driven health plans are very effective at cost control. Most companies think that these strategies are only “somewhat effective.” In the near future, Kaiser says that about half of all firms with 200 or more employees are “very likely” to increase employee health-care contributions.

The annual survey by the Kaiser Family Foundation and the Health Research and Educational Trust shows that between the spring of 2003 and the spring of 2004, health-insurance premiums rose by 11.2 percent. In 2003, premiums rose 13.9 percent.

Among the survey’s other findings:

  • More than half of all employees with health coverage are enrolled in PPOs. About 25 percent of all covered employees are in HMOs.
  • Of firms offering health benefits, 17 percent offer incentives to people who decline coverage. (The topic has generated discussion online).

Co-payments for doctor’s-office visits rose in 2004. Twenty-seven percent of employees paid $20 for visits, compared to 19 percent last year.

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