By Cyril Tuohy
Preliminary responses to a major survey of employers predict the cost of health benefits per employee covered through an employer-sponsored plan will rise 3.9 percent on average in 2015.
The increase will be the result of employers covering more people in accordance with the Affordable Care Act (ACA), according to Mercer, a benefits and human resources consultancy that is conducting the survey.
Under health care reform, an estimated 22 percent of health plan sponsors are likely to increase enrollment when they open their health plans to all employees working 30 or more hours a week, Mercer’s National Survey of Employer-Sponsored Health Plans reveals.
In addition, a penalty for individuals who do not choose coverage will rise next year to a minimum of $325, so people will have incentive to seek coverage, either through their employer or in the individual market.
“The math is simple — the more employees you cover, the more you spend,” said Beth Umland, Mercer’s director of research for health and benefits. “But this additional spending isn’t accounted for when we talk about the low growth in the cost of coverage.”
Cost growth slowed to 2.1 percent in 2013, a 15-year low, Mercer said.
Mercer's findings are based on the preliminary results from its survey, which 1,700 employers responded to by Sept. 1. The survey is still in the field.
"Ultimately, around 2,800 employers will participate in the survey and the final results will be weighted to be nationally projectable," Mercer said in a news release.
Under the ACA, nearly every American is required to have health insurance. Most people and their families will be covered through employer-sponsored plans. People who decline their employer-sponsored coverage can find coverage in the individual market or through the federal and state health exchanges.
The survey also found that 66 percent of the 1,700 respondents will make changes to their health plans next year to dampen the growth of health care costs, and that 73 percent of large employers will offer a consumer-directed health plan within three years. Consumer-directed health plans come with high deductibles.
Raising the deductible to $5,000 or $10,000 a year shifts more of the cost burden onto the employee, but it also lowers the monthly health care premium that is usually split between the employer and the employee.
About 50 percent of large employers offer high-deductible, consumer-directed health plans; and within three years, 20 percent of large employers say it will be the only choice available to employees, up from 6 percent of employers currently, the survey found.
“The move toward high-deductible, consumer-directed plans is spurring other changes as well, such as more voluntary options,” Watts said. “While some employees are comfortable with a lower level of coverage, offering supplemental insurance alongside a high-deductible plan gives employees access to more protection if they want it.”
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].
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