The rising cost of providing employee health benefits won't be rising as fast in 2015 as it did this year. And that reduction in annual increases could become a trend, at least among large U.S. employers.
Those are two significant findings from a survey from the National Business Group on Health, a non-profit association of nearly 400 large U.S. employers. The survey suggests that the efforts by large employers to better control their health-care costs are working as they integrate wellness plans, cost-sharing and consumer-directed health plan elements into their design strategies. No respondent to the survey expects to discontinue offering coverage to employees in the near term.
"Our survey shows that many employers are, in fact, taking necessary steps to rein in costs. This includes partnering with workers to engage in health care decisions and educating them to be better health care consumers, as well as sharing more costs with workers and narrowing their benefit options," said Brian Marcotte, President and CEO of the National Business Group on Health.
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The survey found that large employers are anticipating an average 6.5 percent increase in health benefits costs in 2015, down from 7 percent in 2014. Looking ahead, these respondents believe they will realize cost increases in the neighborhood of 5 percent in 2016 as changes in plan design begin to have a greater impact on cost.
While the increasing adoption of wellness plans has been well documented, reliance on CDHPs to rein in costs also emerged as a major pattern among these employers. The survey found that the number of employers offering workers a consumer-directed health plan (CDHP) as the only health benefits option may increase by as much as 50 percent in 2015. Next year, 32 percent said they would make the move to CDHPs, compared to 22 percent that did so this year.
See also: 2015 rates expected to fluctuate wildly
The survey also sought input on the effects on plan design related to the Patient Protection and Affordable Care Act. "Employers are making numerous changes to their benefit plans in an effort to control costs as well as comply with the ACA and stay below the excise tax set to be implemented in 2018," NBGH said. Here's what was reported back:
- 73 percent are adding or expanding tools to encourage employees to be better health care consumers;
- 57 percent are implementing or expanding CDHPs; and
- 53 percent will either add or expand wellness program incentives.
Private exchanges continue to pique employer interest, as demonstrated by these results:
- 3 percent will offer employees health insurance through a private exchange in 2015;
- 35 percent said they are considering shifting workers to a private exchange in 2016 or beyond; and
- 14 percent are partnering with a private exchange for their retirees this year, an increase from 10 percent last year. Another 7 percent are planning to move retirees to private exchanges in 2015.
But employers expressed some concerns about private exchanges and indicated they needed more information before fully embracing them as an option to current coverage plans.
"Employers, including many of our members, are clamoring for information and help in understanding private exchanges and whether they make sense for their organizations," Marcotte said. "The proliferation of private exchanges is presenting employers with an option but one that employers need to ask questions and study carefully. For example, employers will want to determine whether a private exchange can manage costs and care more efficiently than what they are currently doing."
Among other findings:
- 26 percent have a plan that includes a narrow network, and 13 percent offer a plan that gives employees incentives to use a narrow network within the plan;
- 33 percent use a freestanding specialty pharmacy while 29 percent only approve coverage for a 30-day initial supply; and
- 73 percent will cover surgical interventions for the treatment of severe obesity and 41 percent will cover FDA-approved medication.
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