Thursday, November 20, 2008

Health care costs to rise 6.5% in '09 for local employers: survey

Crain's:
Chicago-area employers are girding for a 6.5% rise in health-benefit costs next year, even as many companies shift more of the cost increases to workers, according to a survey released Wednesday.

About 40% of the 104 local employers polled said they were requiring workers to cover a greater portion of their health-insurance premiums in 2009, according to the survey by Mercer, a New York-based human resources consultancy. About one-quarter said they were boosting co-payments, deductibles or out-of-pocket limits for employees.

Without those increases, the 6.5% overall cost for local employers would have been 7.7%, said Kristen Stagaman, a Chicago-based principal at Mercer.

The local figures are taken from Mercer’s national survey of nearly 2,900 public and private employers (all with at least 10 workers). The expected 2009 cost increase for local companies is in line with the 6.4% national average.

At the very end of this article info about Health Savings Accounts:
That deductible refers to traditional PPO plans — not plans that are required to carry a high deductible because they are attached to a tax-advantaged Health Savings Account, first introduced in 2004.

“The introduction of the HSA may have changed employers’ thinking on just how high a deductible can go without causing significant employee pushback,” Ms. Stagaman said. “It’s an easier way to reduce cost without taking more out of every employee’s paycheck.”
Now the question that this article doesn't address. Why the increase?

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