Medical care cost hikes expected to ease: Buck surveyReprints
Medical care cost increases, while still high, are easing, according to a new survey released Thursday.
Medical trends, which are projections of increases in the cost of health services, will be lower for all types of health care plans, according to the Buck Consultants L.L.C. survey of 126 insurers and plan administrators.
For example, medical costs are projected to rise 8.7% this year for preferred provider organization plans, down from 9% in 2013 and 9.2% in earlier 2013 surveys; and costs for HMOs are projected to rise 8.6% this year, down from 8.7% in 2013 and 8.8% from the 2013 surveys.
In addition, medical costs for high-deductible health plans are projected to rise 8.6% in 2014, down from 9.1% in both 2013 and 2012, while cost increases in point-of-service plans are projected to increase 8.5% this year, compared with 8.8% and 9% from the 2013 surveys.
The slowdown in cost increases “may be a result of the economic slowdown and its impact on consumers' willingness to seek medical treatment,” Harvey Sobel, a Buck principal and consulting actuary in Secaucus, New Jersey, said in a statement.
Still, “Even though the decline is good news, most plan sponsors still find 8-9% cost increases unsustainable,” Mr. Sobel added.
Health insurers use trend factors in calculating premium rates, while self-funded employers use them in budgeting future costs, Buck said in the statement.
The actual premium an employer will pay for coverage, though, will depend on such variables as its own experience and changes — compared with the prior year — in plan design.