Health Care Cost Increases to Continue at Double Digit Rates, According to Buck Consultants Survey
September 11 2008 - 7:05AM
PR Newswire (US)
NEW YORK, Sept. 11 /PRNewswire-FirstCall/ -- Costs for the most
popular types of health care coverage are projected to increase at
double-digit rates through the remainder of 2008 and into 2009,
according to a national survey of insurers and administrators.
These are among the results of a survey released today by Buck
Consultants, an ACS company and one of the world's leading human
resource and benefits consulting firms. The study analyzed
responses from 79 health insurers, HMOs and third-party
administrators. In its 19th National Health Care Trend Survey, Buck
Consultants measured the projected average annual increase in
employer-provided health care benefit costs. Insurers providing
medical trends for the survey cover a total of approximately 98.7
million people. Costs for the most popular plans (see chart below)
continue to increase by more than 10 percent, and are slightly
higher than the trends reported in Buck's previous survey,
conducted in late 2007. Type of Plan Buck's National Health Care
Trend 19th Survey 18th Survey Difference Preferred Provider
Organization (PPO) 11.1% 10.7% +0.4% Point-of-service (POS) 10.8
10.5 +0.3 Health Maintenance Organization (HMO) 11.1 11.1 - High
Deductible Consumer Driven 10.7 10.4 +0.3 Health insurers reported
an average prescription drug trend of 11.4 percent, down slightly
from the 11.7 percent reported in the prior survey. This is
considerably higher than the 7.8 percent reported by pharmacy
benefit managers (who generally do not take any underwriting risk).
For plans that supplement Medicare, health insurers reported a
projected increase of 6.9 percent excluding prescription drug
coverage. This lower trend reflects the impact of federal controls
on Medicare fees and the lower increases expected in Medicare
deductibles and copays. The survey also reported trend factors for
dental and vision plans. "While trends have come down significantly
since 2003, they still remain stubbornly high," said Harvey Sobel,
FSA, a Buck principal and consulting actuary who directed the
survey. "We are concerned that these trends may not yet reflect the
impact of recent inflationary increases, which may put additional
cost pressure on health care providers to raise their fees." Health
insurers use trend factors to calculate premium rates, and large
self-funded employers use these trend factors to budget their
future health care costs. In general, trend factors provide for
price increases that may result from such variables as inflation,
utilization of services, technology, changes in the mix of
services, and mandated benefits. Buck Consultants, an ACS company,
is a leader in human resource and benefits consulting with more
than 1,500 professionals worldwide. Founded in 1916 to advise
clients in establishing and funding some of the nation's first
public and private retirement programs, Buck is an innovator in the
areas of retirement benefits, health and welfare programs, human
capital management, and employee communication. News and other
information about Buck Consultants are available at
http://www.buckconsultants.com/. Buck is an independent subsidiary
of Affiliated Computer Services, Inc. ACS, a global FORTUNE 500
company with 65,000 people supporting client operations reaching
more than 100 countries, provides business process outsourcing and
information technology solutions to world-class commercial and
government clients. The company's Class A common stock trades on
the New York Stock Exchange under the symbol "ACS." Learn more
about ACS at http://www.acs-inc.com/. Buck's 19th "National Health
Care Trend Survey" is available to the media by contacting Ed
Gadowski at 201-902-2825. It is available to other interested
parties for $100 from Buck's Global Survey Resources, 500 Plaza
Drive, Secaucus, NJ, 07096-1533. Telephone 800-887-0509. It also
can be ordered online at http://www.bucksurveys.com/. DATASOURCE:
Affiliated Computer Services, Inc. CONTACT: Ed Gadowski, Media
Relations of Buck Consultants, LLC, +1-201-902-2825, Web site:
http://www.acs-inc.com/ http://www.bucksurveys.com/
http://www.buckconsultants.com/
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