Group health care cost increases are up from last year but remain much lower than those of a few years ago, research shows.
In 2008, group health care costs increased by an average of 6.0%, to $8,331 per employee, and are projected to rise next year by 6.4%, according to an analysis released Monday by Hewitt Associates Inc. of Lincolnshire, Ill. The analysis is based on information from more than 400 employers.
This year's 6.0% average increase is up from a 5.3% increase in 2007 but is substantially lower than 2006's average increase of 7.9% and the 9.2% hike in 2005.
By plan type, traditional indemnity plan cost increases were the highest, rising by 10% this year to an average of $9,296 per employee. Health maintenance organization costs jumped 8%, averaging $8,442 per employee, while preferred provider organization costs rose by 4.8%, averaging $8,048 per employee. Point-of-service plan costs climbed 3.8% to $8,986.
As health care plan costs have risen, cost-shifting to employees also has increased. For example, employees' total health plan costs—which include out-of-pocket expenses, such as deductibles and copayments, as well as premium contributions—averaged $3,513 per employee in 2008, up 9.9% from 2007.
Copies of Hewitt's health care cost analysis are available at www.hewitt.com.
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