Large U.S. employers may be outbargaining smaller employers in the benefits market.[@@]
Researchers at the Council of Insurance Agents and Brokers, Washington, have published data supporting that conclusion in a report on an informal survey of CIAB members conducted earlier this fall.
Rate increases seem to be slowing for employers with more than 500 employees.
CIAB members say that only 33% of large accounts have faced group health rate increases of more than 10% in the past year, while 37% of those accounts have seen their group life rates fall at least 10% over the same period.
Back in 2004, 40% of large employers were facing group health rate increases of 10% or more. Only 25% were seeing group life rates come down 10% or more.
The picture is different for midsize CIAB member clients with 51 to 500 employees and small CIAB member clients with 50 or fewer employees.
Only 25% of the medium accounts and 15% of the small accounts are enjoying double-digit decreases in group life rates. Those figures are comparable to the 2004 CIAB survey results.
The share of midsize accounts facing double-digit group health increases is holding steady at 69%.
Meanwhile, group health rate shock seems to be growing in the small group market: 79% of small CIAB benefits clients now are suffering from double-digit health rate increases, up from 69% a year ago.