Nov. 21—A national employer survey found the cost of workers’ healthcare grew by only 2 percent in 2013.
A preview of Mercer’s annual National Survey of Employer-Sponsored Health Plans found total health benefit costs for each employee increased only 2.1 percent in 2013, which was a slowdown from the 4.1 percent increase last year.
However, health costs are expected to jump 5.2 percent in 2014. Costs will jump by 8 percent if existing insurance coverage plans are not changed.
Employees’ total 2013 costs averaged $10,779, which includes employer and employee contributions for medical, dental, and other health coverage.
The survey of 2,842 public and private employers with at least 10 employees found cost growth was lowest for small employers in 2013. Employers with 10 to 499 employees had average costs increase about 1 percent, while employers with 5,000 or more employees had a 3.7 percent cost increase.
The lower small employer increase was credited to the use of higher deductibles. The average PPO in-network individual deductible jumped 15 percent to $1,663.
“The good news is that employers have already taken decisive action to slow cost growth, so they will be in a better position to handle the challenges ahead,” Julio A. Portalatin, president and CEO of Mercer, said in a release.
Enrollment in consumer directed health plans (CDHPs) rose from 16% of covered employees in 2012 to 18% in 2013, which matches HMO enrollment, according to the survey. It found the average cost of coverage in a CDHP paired with a tax-advantaged health savings account is 17% less than coverage in a PPO and 20% less than in an HMO.
Mercer estimated that about a third of employers are at risk for triggering the 40 percent excise tax in 2018 if they make no changes to their most costly plan.
Publication Date: Thursday, November 21, 2013