NU Online News Service, Oct. 7, 2004, 5:02 p.m. EDT

Big employers expect to pay an average of 8% more for health coverage for active employees in 2005 than they are paying this year.[@@]

Researchers from Towers Perrin L.P., New York, a human resources consulting firm, are basing that projection on a group of about 200 responses to the company’s 2005 health care cost survey. Most of the participating employers are multinational companies with thousands of employees.

A year ago, big employers told Towers Perrin that they expected rates to go up about 11% in 2004.

Although the 2005 increases will probably be smaller than the 2004 increases, the cumulative effect of 6 years of big increases is painful, and the average total monthly cost for active employees will be $328 for employee-only coverage and $945 for family coverage, Towers Perrin says.

One factor driving increases this year has been big jumps in the cost of hospital care, the firm reports.

Although many big employers continue to see double-digit increases in health coverage costs, 10% of the survey participants say they their health care costs will hold steady or drop in 2005, Towers Perrin says.

More than 50% of employers have tried to hold down costs by increasing employees’ “point of care” costs,” and 70% are expanding their disease management programs, Towers Perrin says.