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Member, Beacon International Group, Ltd.
TORONTOCanadian employers will continue to experience double-digit health care cost increases in 2005, although cost increases have moderated slightly compared to previous years, according to a survey by the Canadian unit of Mellon Human Resources & Investor Solutions.
The increase in prescription drug costs, which represent about 65% of the costs of the average employer-sponsored health plan, is projected at 15.1% for 2005, down from 15.6% in 2004, according to Mellon's fifth annual Canadian Health Care Trend Survey.
The company attributed the modest decline to fewer new expensive drugs entering the market and the withdrawal of several blockbuster drugs due to safety concerns. Mellon noted, however, that utilization of prescription drugs is expected to increase in 2005.
Meanwhile, the increase in employer medical costs is estimated at 13.8% for 2005, down from 15.1% in 2004. The increase in employer hospital costs is projected at 11.0% in 2005, compared with 11.1% in 2004.
Twelve Canadian health insurers participated in the survey, which can be found on Mellon's Web site at www.mellon.com/hris/pdf/canada_english_healthcare_trend_05.pdf.