Large Employer Costs to Rise 7% in 2014

The National Business Group on Health represents about 365 large employers and conducts an annual survey of its members to ascertain health benefit trends.  The latest survey on plans for 2014 had 108 respondents.  (NBGH Release)   These large companies are anticipating that the cost to them of providing employee health benefits will rise 7% in 2014, the third consecutive year of this size increase.  As we always like to point out, this increase is much higher than inflation or GDP growth, and for a company, means that it is difficult to keep health costs from increasing as a percent of total costs.  Employers feel under enormous pressure to contain these costs and make their future growth more predictable.  The primary method they have used for this purpose is shifting more cost to employees and that will continue.  An increasing number, 72%, of these large employers offer a high deductible health plan, and they are viewed as the single most effective cost control tactic by 36% of the survey respondents.  In 2014, about 22% of employers are planning to offer only such a plan, up slightly from 2013.  Many large employers believe the public exchanges will be a viable option for some of their employee populations, like part-timers or retirees, and many companies are considering a private exchange approach.  Other common cost control methods include use of on-site clinics by 44% of companies, with 9% more planning to add one in 2014.  Over 80% do health assessments and biometric screenings, with 77% offering health coaching, with tobacco cessation and weight management programs also very common.  It appears that large employers remain committed to improving employee health, but also determined to find ways to make their share of health care coverage costs more predictable.