Mercer on Employer Health Benefits

Like many industry sub-segments, benefit consulting has become highly concentrated.  Mercer is one of the biggies.  These guys used to give us lots of information for free, but now they often want to charge for it.  Here are a few teasers from information released about its current survey of employers in regard to their health benefits.   (Mercer Survey)   Per employee cost among the respondents rose 3% in 2019.  That is eight consecutive years of cost increases under 4%.  The growth has been above that of general inflation and wage growth, but worker earnings increases have almost caught up to the rise in health care costs.  Small employers (those with 10-499 employees) saw more restrained growth, 1.9%, to an average of $12,374 per employee, while large employers experienced 3.4% growth to $13,455 per worker.  Trends include slightly less use of high-deductible plans as the only choice, with only 12% of large companies going this route, although 71% offer a high-deductible plan option and 36% of all employees are enrolled in a high-deductible plan.  Companies are looking to lessen cost-shifting in other ways, for example, large employers put in only a very small average increase in deductible size, and they are trying to offer more use of technology and tools like apps to manage care.  58% of larger employers have at least one tech-enabled disease or condition management offering.  90% of companies offer telemedicine, although only 9% of employees actually used the service.  Telemedicine visits cost about half of an in-person one.  Behavior health is an area where employers are focussing telemedicine use.  Top priorities deemed important or very important include 80% saying better managing high cost claims, which are increasing in number and size; 71% say better managing specialty pharmacy, 68% say creating a culture of health and 48% saying creating more employee engagement and empowerment.  Interestingly, 42% said helping with affordability for lower-paid workers was a priority.  Unless and until we get Medicare for All, employer-based coverage is going to be very important for most working Americans.