Benefits

Employers Seek to Limit 2010 Health Cost Increases, Survey Finds

By Staff Report

Sep. 14, 2009


Employers are expecting a nearly 9 percent increase in the cost of their group health care plans in 2010 but plan to trim that increase to 5.9 percent through a variety of cost-cutting actions, early responses to an annual survey by Mercer indicate.


Although employers try to reduce their projected cost increases every year, survey respondents say they are cutting their health care benefit budgets more than usual for 2010 because of the recession.


In fact, employers most strongly affected by the recession reported both a higher underlying cost trend, 9 percent, and a lower targeted cost increase, 5.4 percent, on average than unaffected employers, which anticipate an 8.5 percent growth rate that they plan to trim to 6.3 percent.


Linda Havlin, a worldwide partner at Mercer based in Chicago, attributed the higher costs among recession-affected employers to a surge in stress-related illnesses among employees and layoffs.


“Actual or feared loss of employer-subsidized coverage makes people think about filling their medications, getting their preventive care and taking care of any elective procedures that they have postponed,” she explained.


Among the most popular measures employers are using to lower their 2010 health care cost trend are eliminating higher-cost or more generous health plan options as a way to move employees into lower-cost options, such as high-deductible consumer-directed health plans; auditing plans to ensure that all covered dependents are actually eligible for coverage; and adding or renegotiating performance guarantees with plan vendors.


These preliminary findings are based on responses from 1,562 employers. The survey is still being conducted, and complete results, including the actual rate of increases employers experienced in 2009, will be released by year’s end.



Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


Stay informed and connected. Get human resources news and HR features via Workforce Management’s Twitter feed or RSS feeds for mobile devices and news readers.

About Workforce.com

blog workforce

We build robust scheduling & attendance software for businesses with 500+ frontline workers. With custom BI reporting and demand-driven scheduling, we help our customers reduce labor spend and increase profitability across their business. It's as simple as that.

Book a call
See the software

Related Articles

workforce blog

Benefits

EEOC says that employers legally can offer incentives to employees to get vaccinated in almost all instances

If you’re an employer looking to get as many of your employees vaccinated as possible, you can rest eas...

ADA, CDC, COVID-19, EEOC, GINA, pandemic, vaccinated

workforce blog

Benefits

Fixing some common misconceptions about HIPAA

Ever since the CDC amended its COVID-19 guidance to say that the fully vaccinated no longer need to wea...

COVID-19, health care, HIPAA, human resources, wellness

workforce blog

Benefits

We are in the midst of a public mental health crisis; how employers can help

Do not ignore these issues or your employees who are living with them. Mental health illnesses are no d...

ADA, benefits, Coronavirus, FMLA, mental health, paid time off