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COSTS NOT OVERSHADOWING VALUE OF U.K. HEALTH PLANS

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U.K. employers increasingly view health care as an important employee benefit, though companies are anxious about rising costs, according to a recently published survey.

Of 337 companies of various sizes that responded to a Hogg Robinson Financial Services Ltd. survey, 90% provide private health care benefits to their employees.

While 43% of respondents said they offer health care benefits to maintain a healthy workforce and 41% provide the benefits to get employees back to work more quickly, 32% also cited providing health care benefits as important in retaining employees.

Although "14% of employers would discontinue the employer-sponsored health care provision if they had the choice. . .it seems reasonable to conclude that the value attached to private health care by employees has served to deter employers from abandoning" their health care plans, the report stated.

While appreciating the value attached to the plans by employees, companies have several concerns about providing health care. The chief concern, which 78.5% of respondents cited as their major concern, is rising costs. Thirteen percent of companies complained that costs had risen 11% to 15% during the past year.

The second major concern of employers was reduced coverage by insurers, followed by increased usage by plan members; increased insurance premium tax; and the administrative burden on employers.

Meanwhile, employers are adopting a variety of approaches to cap the cost of providing health care benefits, Hogg Robinson found.

According to the survey:

31% of employer respondents have increased employees' contributions, introduced a deductible in an attempt to reduce claims and shift some cost to employees.

20% have a managed care program.

11% have psychiatric coverage exclusions.

9% use hospital networks.

3% use coinsurance.

Free copies of the survey are available from Hogg Robinson Healthcare, Hogg Robinson House, 42/62 Greyfrars Road, Reading, Berkshire, England RG1 1NN; 0118-939-5328; fax: 0118-957-5488; http://www.hogg-robinsonfs.co.uk.

By Carolyn Aldred