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Employers still tweaking health plan designs to control costs

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Despite the delay of the Cadillac tax until 2020, a report published Tuesday shows that many employers continue to make health plan design changes to control rising health benefit costs.

Employers are shifting more costs to employees through higher deductibles and copays, encouraging alternative care such as telemedicine and increasing their use of spousal and tobacco surcharges, according to the report by Arlington, Virginia-based business advisory firm CEB and Birmingham, Alabama-based DirectPath, formerly Enrollment Advisors L.L.C.

Regardless of the health plan type, 28% of organizations now offer high deductible health plans for both individual and family coverage, up from 25% for individuals and 23% for families in 2015, according to the report, which analyzed more than 750 employee health plans. The average organization in the study had 62,000 workers, a spokeswoman said.

High-deductible health plans are defined as having a minimum deductible of $1,300 for individual coverage and $2,600 for family coverage, according to the report.

The average in-network annual deductibles increased by 40% to $1,087 for individual coverage and 17% to $1,857 for family coverage compared with 2015, the report shows.

Additionally, spousal and tobacco surcharges are becoming more common. While 41% of employers have introduced or are planning to introduce spousal surcharges, the average spousal surcharge dropped slightly to $107 from $120 last year, the report showed. Twenty-one percent of employers imposed tobacco surcharges, which ranged from $10.50 per month to $217 per month.

“Even though the impending Cadillac tax is still a ways off and it is an election year, organizations continue to look ahead and are making further moves to implement cost-savings measures,” DirectPath CEO Bart Yancey said in a statement accompanying the report. “The tide of change is strong. It's up to consumers to become savvy about their health care options, and it's up to their employers to provide the educational resources to help them make smart decisions — whether it's knowing when to visit an urgent care center versus an emergency room, choosing a generic drug or considering telemedicine.”

Other findings include:

• Virtual care, such as telemedicine, is now offered by 37% of employers, and an additional 27% plan to offer such services in the next three years.

• Fifty-seven percent of employers provide some type of wellness incentive, ranging from $52 to $1,600 per year in value. Others offer a reduction in health plan premiums of up to 10%.

• The average in-network copay for outpatient surgery decreased by 25% to $41 in 2016 from $55 in 2015, while inpatient surgery increased 68% to $67 from $40 the year before.

• The average in-network emergency room copay jumped 22% to $142 in 2016, up from $116 the previous year, while copays for urgent care remained the same at $31.

• The average in-network copay for specialty drugs increased by 45.1% to $74 in 2015 for retail, and by 48.7% to $122 for mail-order drugs.