MANAGED CARE December 2006. ©MediMedia USA
This year, U.S. companies experienced the lowest health care cost increase in eight years, with health care costs per person expected to increase from $7,744 in 2006 to $8,340 in 2007. The overall rate of the increase continues to be a major concern as it outpaces inflation and salary increases. That's according to a recent report by Hewitt Associates, which says average employee out-of-pocket costs, such as copayments, coinsurance, and deductibles, are also expected to increase from $1,489 to $1,627 in 2007.
If growth of health care costs is slowing down, the next question is for how long? Blaine Bos, a partner at Mercer Health & Benefits, says we shall soon "see how well the leading-edge strategies for longer-term cost management — care management and consumerism — are working."
Hewitt expects that preferred provider organizations will experience a 7 percent cost increase in 2007, and health maintenance organizations and point-of-service plans will see an 8 percent and 9 percent increase, respectively.
Average annual employee contributions and out-of-pocket costs
Costs by plan type
Source: Hewitt Associates