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Group health plan cost hikes were modest in 2015, but increases predicted

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Group health care plan costs increased on average by just 3.2% in 2015, but bigger, though still modest, increases likely lay ahead, according to new research released by Aon Hewitt.

Group health care plan costs rose to an average of $11,032 per employee in 2015, according to the analysis released Thursday by Lincolnshire, Illinois-based Aon Hewitt. Costs include employer and employee premium contributions, but not employee out-of-pocket costs, such as copayments and coinsurance.

Other findings include:

• The average employee premium contribution for coverage in 2015 was $2,490 up 5.5% from 2014.

• Employees' out-of-pocket costs averaged $2,208 in 2015, up 12.9% from the prior year.

• By plan design, premiums rose the most for health maintenance organizations for which costs in 2015 increased by an average of 4.2% to $11,235 per employee.

• By plan design, the most expensive plans were point of service plans, where premium costs averaged $11,907 per employee in 2015, up 2.5% over the prior year.

• Preferred provider organizations were the least expensive plans, with premiums averaging $10,897 per employee in 2015, up 3.1% from 2014.

Aon Hewitt consultants are projecting, due to the soaring costs of prescription drugs and the pent-up demand for medical services, an uptick in premium costs in 2016, with premiums rising by an average of 4.1%.

“The sluggish growth in the economy has deterred many individuals from using medical services, and there's also been modest price inflation — both factors have been primary drivers for the low rates of premium increases over the past few years,” Michael Morrow, an Aon Hewitt senior vice president in Denver said in a statement.

“As prescription drug costs continue to grow at a double-digit pace and the economy picks up speed, it's likely these premium rates will start to climb,” Mr. Morrow added.