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One employer could easily offer health coverage that costs more than three times as much as the coverage at a similar employer right down the road.
Vivian Ho, an economist at Rice University's Baker Institute for Public Policy, and two colleagues look at variability in employers' health plan spending in a report posted Wednesday.
Ho's team started by gathering data on 27 different health plans at 10 different universities and university benefits coalitions.
The full median cost of coverage, including both employer contributions and employee contributions, was $10,899 for employee-only coverage and $28,819 for family coverage.
But the spending differences between the lowest-cost plans and the highest-cost plans were big.
For employee-only coverage, annual spending ranged from $5,995, for a "reference-based pricing," or "name your own price" plan at the University of the Incarnate Word, up to $15,742, for a preferred provider organization plan at Trinity University. The most expensive plan cost 2.6 times more than the least expensive plan.
For family coverage, spending ranged from $14,208, for the University of Incarnate Word reference-based pricing plan, up to $48,636, for a point-of-service plan at Rice. The Rice plan was 3.4 times more expensive than the University of the Incarnate Word plan.
"Public reporting on insurance cost variations remains scarce," the researchers write. "However, the disparities identified among Texas universities likely exist nationwide, spanning both public and private sectors."
What it means: The researchers contend in their report that the big price differences suggest that some employers may feel as if they have to cover a wide range of providers and whatever the providers want to charge.
"By acting as if they must accept any price increase regardless of cost, they forfeit their leverage, which drives up expenses for both the employer and its employees," the researchers write. "The premium variations identified in this report can be used as a starting point for efforts to find more cost-effective coverage for workers and improve healthcare affordability in this country."
The backdrop: Organizations like KFF and Milliman publish data every year on average or median employer plan costs.
The new study is different because it focuses on the price variations, rather than the typical prices.
Analysis details: The researchers say some of the factors affecting a university's health benefits costs include the number of employees in the plan, provider costs in a university's area, and the size and flexibility of the provider network.
The researchers did not try to adjust their cost data for quality, patient satisfaction levels or care outcomes.
But the researchers argue that the universities with higher costs might be able to reduce premium spending without sacrificing quality.
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