iLoveBenefits: Industry News Blog

Health care Premium Increases and Exchange Participation

    • Premium increases in the health insurance marketplaces created under the Affordable Care Act (ACA) will likely be higher in 2017 than in recent years. Kaiser Family Foundation analysis of proposed rates in states that make the information publicly-available shows an average premium increase in the benchmark second-lowest-cost Silver plan in 17 major cities of 9% in 2017, compared to an average increase of 2% in these cities in 2016.
    • Aetna CEO Mark Bertolini announced Tuesday (Aug. 2) that while the company is pleased with its overall second-quarter results, it will not enter exchanges in additional states in 2017 as planned and is revisiting its current position in 15 states.

Shifting the cost of health care

According to a recent analysis, total health care costs covered by employers have fallen by about 1% per year since 2012. Source: “2015 Records Lowest U.S. Health Care Cost Increases in Nearly 20 years,” Aon Media Center, November 12, 2015, http://aon.mediaroom.com/2015-11-12-2015-Records-Lowest-U-S-Health-Care-Cost-Increases-in-Nearly-20-years

1% might not sound like a lot, but consider that on a roughly right basis if the cost of individual health care is $10,000 and the employer had been picking up 80% and the employee 20% a 1% shift is $80 PLUS the amount of the annual increase. If the increase is 6% then that’s an increase of $600 (of which the employee is paying an additional $120. So the total increase including the shift is @$200. So where they were paying $2000 (20% of $10,000) they are now paying 21% of $10,600 or $2226. That is an 11.3% increase year over year.

U.S. Spends $9,086 Per Person Annually on Healthcare

The Commonwealth Fund recently released an analysis comparing U.S. healthcare to 12 other high-income countries. Here are some key findings from the report:

  • The U.S. spends $9,086 per person annually on healthcare, compared to $6,325 in Switzerland.
  • Health care consumed 17.1% of U.S. GDP in 2013, about 50% more than any other country.
  • People in the U.S. visit doctors an average of four times per year.
  • Americans have 126 hospital visits per every 1,000 people, compared to 252 visits in Germany.
  • Prescription drugs are 2x more expensive in the U.S. than the U.K., Australia, and Canada.
  • Heart bypass surgery costs $75,345 in the U.S., compared to $15,742 in the Netherlands.

Source: The Commonwealth Fund, October 8, 2015

October 26, 2015 | Categories: Benefits,Cost,healthcare | Tags: , , , | Comments (0)

What part of your health care budget goes to pharmacy costs?

According to a recent survey, 77% of employers spent 16% or more of their total health care budgets on pharmacy benefits in 2014, up from 71% in 2013. Source: “Majority of Employers Spend 16 Percent or More of Health Care Budget on Pharmacy Benefits: Buck Consultants Survey,” Buck Consultants at Xerox Press Release, February 25, 2015, http://news.xerox.com/news/5th-Annual-Buck-Consultants-at-Xerox-Prescription-Drug-Benefit-Survey

Health Plan premium increases in other countries

Private health premiums to rise by an average 6.18% Asia Insurance Review reports: Private health insurance premiums in Australia are to rise by a weighted industry average of 6.18% from 1 April, Federal Health Minister Sussan Ley has announced. Asia Insurance Review, March 2, 2015

Pte medical premiums in emerging Asia to rise 15.4% Asia Insurance Review reports: Reimbursement-type private health insurance (PHI) premiums in emerging Asia are expected to more than triple from an estimated US$9.4 billion in 2013 to a forecast $31.8 billion by 2020, representing a compounded annual growth rate (CAGR) of 15.4%, according to Swiss Re’s latest sigma study “Keeping healthy in the emerging markets: insurance can help”. Asia Insurance Review, February 26, 2015

Private health premiums in region to rise 9.7% p a to 2020 Middle East Insurance Review reports: Reimbursement-type private health insurance (PHI) premiums in MENA are forecast to more than double from US$7.4 billion in 2013 to US$15.6 billion by 2020, representing a compounded annual growth rate (CAGR) of 9.7%, according to Swiss Re’s latest sigma study “Keeping healthy in the emerging markets: insurance can help”. Middle East Insurance Review, February 26, 2015

March 4, 2015 | Categories: Benefits,Cost,healthcare,insurance | Tags: , , , | Comments (0)

Health Care Costs Are Reducing Income

According to a recent analysis, between 2003 and 2013:

  • health insurance premiums rose 60%
  • employee premium contributions rose 93%
  • incomes grew only 11%

Source: “Employer Premium and Deductible Cost Growth Slowed Post-ACA, But Employer Health Insurance Still Claiming Bigger Share of Workers’ Income,” The Commonwealth Fund Press Release, December 9, 2014, http://www.commonwealthfund.org/publications/press-releases/2014/dec/employer-premium-growth

December 16, 2014 | Categories: Benefits,Cost,healthcare,insurance | Tags: , , , , | Comments (0)

Without plan benefit changes, the estimated 2015 cost would rise by average of 7.1%

With plan benefits changes – 4.5% Guess who pays the difference. . . 

According to the National Survey of Employer-Sponsored Health Plans (conducted annually by Mercer):

  • Employers held down growth in the average per-employee cost of health benefits to 3.9% in 2014.
  • Total health benefit cost averaged $11,204 per employee in 2014.
  • Without plan benefit changes, the estimated 2015 cost would rise by average of 7.1%.
  • 3% of large employers moved to a private exchange in 2014.

Note: Mercer’s nationally projectable annual survey includes public and private organizations with 10 or more employees; 2,569 employers responded in 2014.

Source: Mercer

December 15, 2014 | Categories: Benefits,Cost,healthcare,insurance | Tags: , , , | Comments (0)

There are premiums and then there are the costs paid at time of service

According to a recent report, 21% of adults with health insurance spent 5% or more of their income on out-of-pocket health care costs (excluding premiums) over the past year. Source: “New Commonwealth Fund Report: 21 Percent of Adults with Health Insurance Spent 5 Percent or More of Their Income on Out-of-Pocket Health Care Costs,” The Commonwealth Fund, November 13, 2014, http://www.commonwealthfund.org/publications/press-releases/2014/nov/21-percent-of-adults

Florida – average weighted silver plan premiums to increase by 13.2% in 2015

The Florida Office of Insurance Regulation announced that the average weighted silver plan premium in the state will increase by 13.2% in 2015.  According to the release, the “average monthly premium for a Silver plan ranges between $938 and $1,452 for a family of four earning $51,000.  Even with a federal subsidy, that could mean an out-of-pocket cost of $500 or more per month to have coverage that still requires Florida families to pay about 30% of expenses out-of-pocket for deductibles, copayments, and coinsurance.”

 

PricewaterhouseCoopers LLP’s Health Research Institute (HRI) released an analysis that finds health insurance premiums in the individual market will rise, on average, by 7.5% in 2015.

What does this mean for personal accountability???

According to a recent survey:

  • 76% of the general public think it is appropriate for employers to offer wellness programs that promote healthy behaviors
  • 62% do not think it is appropriate for employers to require workers to pay higher health insurance premiums if they don’t participate in the employer’s wellness program
  • 74% do not think it is appropriate for employers to charge workers higher premiums if they are unable to meet certain health goals

Source: “Kaiser Health Tracking Poll: June 2014,” The Henry J. Kaiser Family Foundation, July 1, 2014, http://kff.org/health-reform/poll-finding/kaiser-health-tracking-poll-june-2014/

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