Employers Are Expecting Moderate Health Cost Increases for 2017

Two recent business surveys find that employers are expecting health care costs to increase by 6% in 2017. Both the National Business Group on Health and Towers Willis Watson surveys found that employers expect to pay only 5% more for health plans after changing plan designs to shift new costs to workers.

The surveys also found:

1. Both surveys identified specialty drug costs as a top concern and reported efforts to implement new plan designs to control these costs.

2. The Willis Towers Watson survey found employers are seeking to contain costs from dependent coverage, including adding new “working spouse surcharges.”

3. The National Business Group on Health found that employers are looking to save money through new arrangements with doctors and hospitals. This includes “telemedicine” and “centers of excellence” facilities that have been shown to provider higher quality service at a lower price.

9/20/2016 UPDATE: A new employer survey from Mercer also finds expectations of moderate cost growth in 2017. That survey finds employers projecting 5.5% increase in health care costs in 2017 and a 4% increase in the employers costs after plan design changes.

Links:

Big Companies Expect Moderate Increases In 2017 Employee Health Care Costs (Kaiser Health News, August 9, 2016)

Specialty Drugs Driving Increases in Employer Health Care Costs (CWA Health Care & Retirement Security Blog, July 5, 2016)

U.S. employers expect health care costs to increase 5.0% in both 2016 and 2017 (Willis Towers Watson, August 8, 2016)

Large U.S. Employers Project Health Benefit Cost Increases to Hold Steady at 6% in 2017, National Business Group on Health Survey Finds (National Business Group on Health, August 9, 2016)

With Cost Growth Stable at 4% Employers Shift Focuse Away from Health Plan Cost-Cutting in 2017 (Mercer, September 14, 2016)