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Segal: Gatekeepers Pull Ahead

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Health maintenance organization (HMO) plans and other plans with gatekeepers could be doing a better job of holding down medical costs than high-deductible plans are.

Benefits consultants at the Segal Company, New York, have published 2011 health care cost trend estimates in a report based on a survey of about 60 health carriers.

The consultants have come up with separate cost trend statistics for traditional fee-for-service (FFS) plans; high-deductible health plans, whether or not the enrollees have health savings accounts or health reimbursement arrangements; open-access preferred provider organization (PPO) plans; PPO plans with primary care physician gatekeepers; and HMOs.

The 2011 projected trends may be similar to the 2010 cost trends, according to the Segal consultants.

Excluding the cost of prescription benefits, the project cost increase will be 12.7% for FFS plans in 2011, down from 13.3% this year; 11% for open-access PPO plans, up from 10.8%; 11.2% for gatekeeper PPO plans, up from 10.6%; and 10.2% for HMO plans, unchanged from 10.2%.

The high-deductible plan cost trend will be 11.7%, down from 11.9%.

The high-deductible cost trend should be slightly lower than in 2010, but high-deductible plan costs will still go up faster than HMO or gatekeeper PPO plan costs.

This year, actual cost trends were significantly lower than what Segal survey participants had predicted for gatekeeper PPO plans, open-access PPO plans and FFS plans, and they were significantly higher than predicted for high-deductible plans. Survey participants had predicted the 2009 cost trend for high-deductible plans would be 10.8%; the actual trend was 11.4%.

“Price inflation for inpatient hospital stays is the largest component of overall plan cost trend,” the Segal consultants say.

Participating carriers estimated complying with the Affordable Care Act, the federal legislative package that includes the Patient Protection and Affordable Care Act (PPACA), will add about 1.1 percentage points to 2 percentage points to the 2011 cost trend.

- Allison Bell


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