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Midsized Businesses Grapple with Healthcare Coverage Options

John Commins, for HealthLeaders Media, August 29, 2011

For 2012, the survey projected that the average reported annual cost of medical and pharmacy coverage will be $11,204 per employee for active coverage. Two-thirds of employers will increase employees' share-of-premium contributions for single-only coverage for 2012, and 73% will increase them for employees with dependent coverage.

"It is clear from our research that employers remain committed to providing employer-sponsored benefits for the foreseeable future," Randall Abbott, senior healthcare consulting leader at Towers Watson, said in the report. "2012 will ultimately be a defining year— the year some employers head down a path of bold and decisive actions, while others will wait and see. Whether choosing to pay or play, employers will need a strategic view for the future."

Cost shifting is expected to continue well beyond 2012. By 2013 or 2014, the survey showed that 23% of employers are considering significantly reducing their subsidization of coverage for spouses and dependents, and 19% are considering spousal waivers and surcharges when other coverage is available.

Now, only 5% of employers have, or plan to encourage, performance-based payments to providers based on the health status of plan participants by 2012, but an additional 26% are considering the implementation of this strategy for 2013 or 2014.

Robert Zirkelbach, press secretary for America's Health Insurance Plans, told HealthLeaders Media that the healthcare reforms will place a tremendous burden on the nation's businesses, in part because the emphasis is on expanding coverage and not containing costs.


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