Hewitt: More Companies Look To Cut Health Care Costs

Health care reforms being discussed by the Obama administration in Washington may be allowing these employers to see exiting health care as a more feasible choice than it used to be, Hewitt says.

“In today’s environment, employers are under pressure to cut health care expenses, but they realize that short term cost-management tactics do not address the underlying drivers of health care cost,” said Jim Winkler, head of Hewitt’s North America health management consulting practice. “This leaves them with two options: making a long-term commitment to improving the health of employees and their families, or exiting health care altogether. Most companies believe that investing in the long-term health of their population is the most effective way to mitigate costs and create a more productive and engaged workforce.”

According to the survey, 52% of companies said the economic downturn will have an impact on their 2010 health care programs. It found that 65% plan to shift more costs to employees, and 49% expect to cut the number of benefit plans they offer. In addition, 33% plan to increase their focus on wellness programs, and almost 40% plan to increase the prevalence of consumer-driven health care plans.