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Milliman sees health costs biting back

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The total cost of typical employer-sponsored preferred provider organization (PPO) coverage for a family of four has increased 6.3 percent this year, to $24,671.

Analysts at Milliman have published that estimate in their latest medical cost index.

Climbing specialty drug spending helped increase the level of cost growth up from 5.4 percent in 2014.

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Both this year and last year, increases in employer health benefits costs have been below the 10-year average, but the increases in health benefits costs are still much higher than the overall rate of inflation, the analysts say.

The employees’ total share of benefits costs, including employee premium contributions and out-of-pocket costs, has increased 8 percent this year, to $10,473.

The employers’ share has increased 5 percent, to $14,198.

The insurance unit of Wells Fargo came out with a separate health benefits cost report, covering expectations for changes in employee health benefits costs in 2016.

The Wells Fargo analysts found that the 65 insurers they surveyed expect the underlying cost of care to increase 8.7 percent at PPO plans in 2016, up from 7.9 percent this year.

The analysts expect the rate of growth in prescription claim costs to rise 10.1 percent. This year, drug costs are 10.2 percent higher than they were in 2014.


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