Brokers and employers alike should brace for more double-digit increases in their health insurance costs in 2010, surveys from two benefit consulting firms suggest.
Based on feedback from health insurers, managed care organizations, PBMs and TPAs, Aon Consulting and The Segal Company are projecting that health benefit costs will be between 10.4% and 11.9% higher next year, depending on the type of plan.
"While we're seeing a slight decrease in the trend rates, it's still at double digits," says John Zern, Aon's U.S. health & benefits practice leader. "This year it's compounded by a struggling economy, lower wage increases and, in some cases, salary freezes."
Aon's survey of 60 health care insurers indicates that the cost of PPO/POS plans will increase 10.4% to10.7%, while Segal’s poll of 80 health insurers, managed care organizations, PBMs and TPAs shows a 10.6% to10.8% increase for these types of plans. Similar hikes are in store for HMOs; Aon expects a 10.4% hike and Segal predicts 10.2%.
The biggest difference between the two surveys is in the projected cost increases for consumer-driven, or high-deductible, health plans. Aon anticipates a 10.5% increase for CDH plans and Segal forecasts an 11.9% jump.
Both companies' results are equal to or within two-tenths of a point from their respective 2009 projections, with the exception of Segal's HMO projection, which increased by 1.1% from 10.8% in 2009.
Prescription drug cost increases are expected to remain within the 9% range. For 2010, Aon expects the costs will rise 9.3%; Segal predicts a 9.1% increase.
