By Karen Garloch
As uncertainty about health reform persists, businesses in North
Carolina and across the country continue to shift health insurance
costs to employees, a new survey found.
Even though health care costs continue to rise, employers held the growth to 4 percent in 2012, the smallest in 15 years, according to the annual National Survey of Employer-Sponsored Health Plans, conducted by Mercer, a human resources consulting firm.
“It might be the calm before the storm,” said Steven Graybill, a senior benefits consultant in Mercer’s Charlotte office. “There’s a lot more changes on the horizon. There’s a lot of uncertainty.
“Health care reform has driven employers to offer more higher deductible plans,” he said. “They are looking to create more affordable options.”
Nationally, 22 percent of employers offer “consumer-driven” health insurance plans with deductibles of $1,000 or more and special accounts that allow employees to save pretax dollars to cover out-of-pocket expenses, Mercer found. In North Carolina, 37 percent of employers offer such a plan.
Graybill attributed the slow-down in this year’s increase to employers’ efforts at shifting costs to employees through higher deductibles, co-pays, coinsurance or premiums, and the use of incentives to keep employees healthy.
“Wellness and disease management programs have created some behavioral change,” Graybill said.
For the third straight year, the Mercer survey showed a sharp increase in employers offering incentives, such as lower premiums or cash payments to employees who try to stay healthy. Penalties include higher premiums for smokers or employees who are obese.
For the first time in years, the survey found that small businesses, with under 500 employees, saw a lower increase in health care costs than larger businesses, which are mostly self-insured.
In 2012, the average total health benefit cost per employee was $10,558 nationally, an increase of 4.1 percent over 2011, down from 6.1 percent over 2010, the survey found.
For large employers, the average cost per employee was $11,003, an increase of 5.4 percent over last year. For smaller employers, the average cost per employee was $9,913, an increase was 2.2 percent.
Historically, small businesses have seen greater increases because they “tend to be at the mercy of the insurance companies,” Graybill said.
“I think health reform…has driven some benefits to small employers,” Graybill said. “But there’s clearly still a cost problem. It’s clearly a challenge.”
While some people believe employers will terminate employee health plans after state-based health exchanges are established under the health reform law, the Mercer survey found that only 7 percent of large employers and 22 percent of small employers say it’s likely they’ll drop coverage.
Julio Portalatin, Mercer’s president, said employers are keenly aware that in 2014, when the Affordable Care Act takes full effect, they’ll be asked to cover more employees.
“They’ve taken bold steps to soften the impact, and it’s paying off already,” he said in a statement. “Critical decisions need to be made by the summer so they can be implemented for 2014 open enrollment.”
Even though health care costs continue to rise, employers held the growth to 4 percent in 2012, the smallest in 15 years, according to the annual National Survey of Employer-Sponsored Health Plans, conducted by Mercer, a human resources consulting firm.
“It might be the calm before the storm,” said Steven Graybill, a senior benefits consultant in Mercer’s Charlotte office. “There’s a lot more changes on the horizon. There’s a lot of uncertainty.
“Health care reform has driven employers to offer more higher deductible plans,” he said. “They are looking to create more affordable options.”
Nationally, 22 percent of employers offer “consumer-driven” health insurance plans with deductibles of $1,000 or more and special accounts that allow employees to save pretax dollars to cover out-of-pocket expenses, Mercer found. In North Carolina, 37 percent of employers offer such a plan.
Graybill attributed the slow-down in this year’s increase to employers’ efforts at shifting costs to employees through higher deductibles, co-pays, coinsurance or premiums, and the use of incentives to keep employees healthy.
“Wellness and disease management programs have created some behavioral change,” Graybill said.
For the third straight year, the Mercer survey showed a sharp increase in employers offering incentives, such as lower premiums or cash payments to employees who try to stay healthy. Penalties include higher premiums for smokers or employees who are obese.
For the first time in years, the survey found that small businesses, with under 500 employees, saw a lower increase in health care costs than larger businesses, which are mostly self-insured.
In 2012, the average total health benefit cost per employee was $10,558 nationally, an increase of 4.1 percent over 2011, down from 6.1 percent over 2010, the survey found.
For large employers, the average cost per employee was $11,003, an increase of 5.4 percent over last year. For smaller employers, the average cost per employee was $9,913, an increase was 2.2 percent.
Historically, small businesses have seen greater increases because they “tend to be at the mercy of the insurance companies,” Graybill said.
“I think health reform…has driven some benefits to small employers,” Graybill said. “But there’s clearly still a cost problem. It’s clearly a challenge.”
While some people believe employers will terminate employee health plans after state-based health exchanges are established under the health reform law, the Mercer survey found that only 7 percent of large employers and 22 percent of small employers say it’s likely they’ll drop coverage.
Julio Portalatin, Mercer’s president, said employers are keenly aware that in 2014, when the Affordable Care Act takes full effect, they’ll be asked to cover more employees.
“They’ve taken bold steps to soften the impact, and it’s paying off already,” he said in a statement. “Critical decisions need to be made by the summer so they can be implemented for 2014 open enrollment.”
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