Wednesday, June 21, 2006
Business Wire - June 13: Lincolnshire, Ill. - Preliminary information from Hewitt Associates, a global human resources services company, shows that 2007 HMO rates will increase approximately 11.7 percent representing the fourth consecutive year of declining rate increases.As U.S. companies begin to negotiate HMO plan rates for 2007, data from Hewitt Health Resource - a Web site that captures HMO rate information for nearly 160 large companies representing more than 1 million employees and annual premiums of nearly $4 billion shows that initial 2007 HMO rate increases are averaging 11.7 percent compared with 12.4 percent in 2006 and 13.7 percent for 2005. After plan changes, negotiations and terminations, the final average HMO rate increased by 10 percent in 2006. "Although there has been a steady decline in the level of HMO rate increases over the past several years, double-digit increases are still very difficult for employers to absorb," said Paul Harris, senior health care strategist, Hewitt Associates. "The good news is that there do not appear to be market pressures that might cause rates to begin increasing again. We are continuing to work closely with employers in developing benefit programs that make the most of their current resources, while still providing their employees with high-quality health care coverage."Regional While the U.S. is showing a lower rate of increase overall, some areas of the country, namely the Southeast and West, are experiencing slightly higher rate increases. Preliminary analysis shows 11 percent increases for the Southeast in 2007 compared with 9.4 percent at this time last year, and 13.7 percent for the West compared with 10.9 percent last year. Managing Costs Although increases are moderating, companies are still facing double-digit increases and, as a result, continue to make plan design changes and share more of the cost with employees. For example, the number of companies offering $20 office copays continues to increase from 16 percent in 2004 and 25 percent in 2005 to 29 percent in 2006, while the number of employers offering $10 copays dropped to 17 percent in 2006 compared with 22 percent in 2005 and 29 percent in 2004.Employees are also being asked to share more of the cost of prescription drugs. Employers are also trying to control costs by increasing copays for specialty care and emergency room visits. For example, the number of employers who require more than a $50 copay for emergency room visits has increased to 52 percent in 2006, a significant increase from 33 percent in 2005, 16 percent in 2003 and 7 percent in 2001, while the number requiring only a $50 copay for emergency room visits has decreased to 32 percent in 2006, compared with 55 percent in 2005.
posted by kanth
@ 6:04 PM
permanent link | Post a Comment |
0 Comments:
Post a Comment
<< Home