Bloomberg Law for HR Professionals is a complete, one-stop resource, continuously updated, providing HR professionals with fast answers to a wide range of domestic and international human resources...
June 30 — Employers are shifting health plan costs to employees through increased contributions and plan design changes, a principal at PricewaterhouseCoopers said June 30, citing results of a survey by the firm.
“This year's survey results showed a stubborn frustration with rising health costs, but what surprised me is that employers are more typically using standard approaches for mitigating costs,” such as increasing contributions, Barbara Gniewek, a principal at PwC in New York, told Bloomberg BNA.
Even though the average annual increase in health-care costs, after plan changes are factored in, were lower than expected, employers are continuing to shift health plan costs to employees, according to the report, “Health and Well-Being Touchstone Survey results,” released June 24.
The increase in health care costs was 4.5 percent in 2013, compared with earlier projections of 5.4 percent. The expected annual increase for 2014 is 5.3 percent.
Some 38 percent of employers said they have increased employee cost sharing through medical plan design changes, and 47 percent said they are considering further hikes, the report said.
Employers indicated a number of strategies under consideration to mitigate cost increases over the next three years. Fifty-six percent said they are considering increasing employee contributions, 52 percent said they might further increase employee cost sharing in pharmacy benefit design and 49 percent indicated they are considering implementing or expanding their workplace wellness programs.
“Employers are still very invested in wellness, and some (between 20 and 30 percent) are considering expanding traditional wellness programs to well-being programs encompassing financial, social, community and career attributes,” Gniewek said.
“About half of employers are very likely to re-evaluate their overall benefits strategy in light of health reform,” the report said. According to the report, 44 percent of employers are considering high-deductible health plans (HDHPs) on a full-replacement basis to their current plans to alleviate costs and 18 percent already use HDHPs as the only medical plan option, the report said.
Employers also are considering other future strategies, such as implementing value-based designs (41 percent) or performance-based networks (34 percent of employers), or moving active employees to private exchanges (32 percent), the survey found.
Gniewek said the value-based designs and performance-based networks are “exciting ways to try and bend the cost curve by getting at the delivery system, and using private exchanges as a facilitator is a very interesting concept.”
The survey included about 1,200 employers in the U.S. in 35 industries.
To contact the reporter on this story: Tawny Elgatian in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Jo-el Meyer at email@example.com
The survey results can be downloaded at http://www.pwc.com/us/en/hr-management/publications/health-well-being-touchstone-survey.jhtml.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)