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3 in 4 Employers to Increase Health Plan Deductibles or Copays

Margaret Dick Tocknell, for HealthLeaders Media, April 25, 2011

Employers will continue to shift healthcare benefit costs to employees either by increased contributions or plan design, according to the 2011 Benefit Options Survey released by Indianapolis-based United Benefit Advisors, an employee benefits advisory firm.

The good news is that employers are committed to providing healthcare benefits to active employees and their dependents. Almost 77% said they recognized the value of the benefits while 96% responded that good benefits help attract and retain employees. More significantly, more than half the employers continue to believe they should shoulder the brunt of future health plan premium increases.

Looking at what might happen to health plans in the next five years, 87% of respondents expect to see more healthcare benefit costs shifted to employees. Among the cost-sharing strategies, 5% of respondents said they planned to implement a high-deductible health plan with a health reimbursement arrangement; 6% said they planned to implement an HDHP with a health savings account this year.

In considering plan design changes in 2011, 22% of employers expect to increase deductibles; 21% are looking at increases for office visits and emergency room copays; 17% will increase prescription drug copays; and 13% expect to increase copays for specialists. Only 5 % are looking at value-based plan design.

There is continued employer interest in incorporating programs that stress prevention and personal health management, such as wellness programs with health risk assessments and disease management programs to help employees with chronic conditions. After wellness and disease management, the component most likely to be added is a cost differential for smokers vs. non-smokers.

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1 comments on "3 in 4 Employers to Increase Health Plan Deductibles or Copays"


Arun Potdar (4/26/2011 at 11:52 AM)
Similar survey results and articles have been produced in the past and this topic had been discussed in many forms. Employer based health care is a unique cost of doing business not found in many places in the developed or developing economies of the world. There are disadvantages associated with this type of overhead which becomes the cost of service or product and bad part is employer has no control over these costs nor has the expertise to set controls then why employer want to provide this benefit is a puzzling phenomenon. Healthcare is a necessity not a pleasure so attracting employees via health benefit is not necessarily the only way. Helping the employee to buy health insurance is much more sensible approach. The almost no competition situation in the market and fragmented controls on the insurance providers does not help in controlling costs. Passing the costs on employees in form of higher deductibles and coinsurances is also counterproductive. Financial barriers to care have care avoidance effect that leads to expensive treatment necessities on the long run and productivity losses due to chronically sick employees defeats the purpose of giving the health benefits. This is a vicious cycle and employers should rethink this if they want to be competitive in the global markets. Nations providing healthcare to their work force in fact subsidize the production of goods and services but in the US we do the opposite; burden them. Once a benefit is offered it becomes entitlement and labor unions demand better and costly benefits if the employer is doing well just look at what happened to American Auto Industry. Among other reasons cost of labor was the primary item in eighties and nineties that made Japanese and German Cars more affordable. There has to be an alternative to this burdening the American Businesses with the cost of social necessities of our population. Just imagine if managing Medicare and VA was the responsibility of all American Businesses where would we be against Europe and Asian competitions.