Blame it on an economy still on the mend or go so far as to credit the Patient Protection and Affordable Care Act. Either way, there’s fresh evidence of a slowing in health inflation in the latest survey of employers by Towers Watson and the National Business Group for Health.
The survey also affirmed a trend abundantly familiar to a growing number of working Americans: cost-sharing is on the rise.
The cost of providing employer-sponsored health care benefits, according to the survey, is expected to increase 4.4 percent this year, climbing to $9,560 per employee compared to last year’s $9,157.
That’s a bigger jump between last year and 2012 but not much of one. Employer health costs in that period rose 4.1 percent, the lowest increase in 15 years.
The survey also found that the employees’ share of premiums increased nearly 7 percent, to $2,975, this year.
Out-of-pocket costs also increased. The total employee cost share has climbed from 34.4 percent in 2011 to 37 percent in 2014. Employees now pay over $100 more each month for health care compared with just three years ago.
What’s driving these numbers? Reduced direct coverage, in most cases.
As outlined by the results of a TW/NBGH survey, companies are gradually shedding the components of their health plans because everyone else is doing it. The competitive advantage has swung to those who have divested themselves first of the burdensome expense of employee health coverage.
To be sure, this detailed survey of nearly 600 major U.S. companies offers evidence that plenty of employers (95 percent of respondents) will continue to view benefits packages that include health coverage as something worth retaining. But almost the same number — 92 percent — plan to make changes in the near-term to lessen their coverage responsibility.
The big-picture trend cited by the data is one of the enterprise backing away from health coverage as other options emerge.