Large employers are winning the battle to effectively manage their healthcare costs. While that line item in the budget continues to increase each year, those increases are now closer to the annual escalation rates of other costs, such as salaries.
That's the key finding of an annual survey of large employers by the National Business Group on Health, a business advocacy organization that focuses exclusively on national health policies and issues that affect large corporations. The survey included input from 140 members of the NBGH.
The survey found that, on average, large employers would have expected a 6 percent increase next year in employee health-related spending. But, as in the previous two years, most employers will redesign their health plans to bring that increase closer to 5 percent—the average increase they reported in 2014 and 2015.
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Among the most commonly reported actions these employers will take next year to control costs:
- Premiums and deductibles: One in three employers will make small increases to the percentage of premiums employees pay for individual and family coverage, and one in four will also make small increases to deductibles.
- Spousal surcharges: About a third of respondents said they will increase or add surcharges for spouses who can obtain coverage through their own employer, and a few will exclude spouses altogether when other employer sponsored coverage is available.
- Consumer-Directed Health Plans (CDHPs): This option continues to be popular—83 percent of respondents said they will offer a CDHP in 2016—but it's nothing new, as last year, 81 said they offered a CDHP. A third said they will only offer CDHPs in 2016. Most that offer CDHPs with a health savings account will continue to make contributions to those to assist employees enrolled in CDHPs.
- Telehealth: It's catching on fast as a cost-containment strategy. Three-quarters of respondents plan to offer telehealth to employees in states where it is legal, up from 48 percent in 2015.
- Preventive/maintenance strategies: 81 percent said they will offer nurse coaching for care and condition management; 73 percent will offer nurse coaching for lifestyle management. Nearly three in four provide employees with self-service decision making tools to help them become better health care consumers.
The survey showed that large employers are focused now on avoiding the Cadillac tax on "rich" health plans that is due to kick in in 2018. About half said they would trigger the tax with their current plans, but three-quarters of those who believe they would be vulnerable to the tax are taking steps now to avoid it. The most common strategy is the addition of a CDHP to their plan offerings.
The survey also questioned employers about whether they would consider turning to a private exchange to contain costs or otherwise manage their employee coverage. One-quarter said they were considering it for next year, but so far, only 3 percent reported switching employee coverage to the private exchange model. And fewer this year are pondering it; last year, 35 percent said they were considering it.
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