Thursday, September 29, 2005
Tweet[IWS] Towers Perrin: HEALTH CARE COST SURVEY (8% Increase in Employer-Sponsored) [28 September 2005]
IWS Documented News Service
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Institute for Workplace Studies Professor Samuel B. Bacharach
School of Industrial & Labor Relations Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor Stuart Basefsky
New York, NY 10016 Director, IWS News Bureau
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Towers Perrin Projects An 8% Increase In Employer-Sponsored Health Care Costs For 2006 As Annual Cost per Employee Reaches $8,424
After Five Years of Double-Digit Increases, The Crisis Turns Chronic for U.S. Businesses
Some Employers Take Action to Control Costs and Minimize Cost Shift to Employees
http://www.towersperrin.com/hrservices/webcache/towers/United_States/press_releases/2005_09_28/2005_09_28.htm
STAMFORD, CT, SEPTEMBER 28, 2005 -- According to the 2006 Towers Perrin Health Care Cost Survey, U.S. employers are facing an 8% increase in their 2006 health care costs. Moreover, the cumulative effect of years of double-digit increases has produced a record high for employer-sponsored health care costs in America. In flat dollar terms, next year's gross health care expenditure is expected to rise by an average of $597 per employee, to an average total cost of $8,424 -- representing a 140% increase over the last 10 years.
Employers continue to shoulder the majority of the burden. Employees on average will pay $155 more in 2006, representing a 10% increase from the year before. Employers, on the other hand, will see an increase of $442 per employee, absorbing 74% of the total cost increase. Overall, employers will pay 80% of premium costs and employees will pay 20%.
Notably, while the average cost of health care coverage will increase by $597 per employee in 2006, this figure would have been close to $750 were it not for employer efforts to aggressively manage program performance through vendor selection and performance management, prescription drug expenditures, care management, employee engagement and other initiatives.
These observations are drawn from top-line results of the annual survey, now in its 17th year, conducted by Towers Perrin's HR Services Business. This year's survey includes data on the health benefit programs provided by more than 200 of the nation's largest employers, covering over five million U.S. employees, retirees and dependents.
AND MORE...
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This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.
Stuart Basefsky *
Director, IWS News Bureau *
Institute for Workplace Studies *
Cornell/ILR School *
16 E. 34th Street, 4th Floor *
New York, NY 10016 *
*
Telephone: (607) 255-2703 *
Fax: (607) 255-9641 *
E-mail: smb6@cornell.edu *
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_______________________________
Institute for Workplace Studies
School of Industrial & Labor Relations
Cornell University
16 East 34th Street, 4th floor
New York, NY 10016
________________________________________________________________________
Towers Perrin Projects An 8% Increase In Employer-Sponsored Health Care Costs For 2006 As Annual Cost per Employee Reaches $8,424
After Five Years of Double-Digit Increases, The Crisis Turns Chronic for U.S. Businesses
Some Employers Take Action to Control Costs and Minimize Cost Shift to Employees
http://www.towersperrin.com/hrservices/webcache/towers/United_States/press_releases/2005_09_28/2005_09_28.htm
STAMFORD, CT, SEPTEMBER 28, 2005 -- According to the 2006 Towers Perrin Health Care Cost Survey, U.S. employers are facing an 8% increase in their 2006 health care costs. Moreover, the cumulative effect of years of double-digit increases has produced a record high for employer-sponsored health care costs in America. In flat dollar terms, next year's gross health care expenditure is expected to rise by an average of $597 per employee, to an average total cost of $8,424 -- representing a 140% increase over the last 10 years.
Employers continue to shoulder the majority of the burden. Employees on average will pay $155 more in 2006, representing a 10% increase from the year before. Employers, on the other hand, will see an increase of $442 per employee, absorbing 74% of the total cost increase. Overall, employers will pay 80% of premium costs and employees will pay 20%.
Notably, while the average cost of health care coverage will increase by $597 per employee in 2006, this figure would have been close to $750 were it not for employer efforts to aggressively manage program performance through vendor selection and performance management, prescription drug expenditures, care management, employee engagement and other initiatives.
These observations are drawn from top-line results of the annual survey, now in its 17th year, conducted by Towers Perrin's HR Services Business. This year's survey includes data on the health benefit programs provided by more than 200 of the nation's largest employers, covering over five million U.S. employees, retirees and dependents.
AND MORE...
_____________________________
This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.
Stuart Basefsky
Director, IWS News Bureau
Institute for Workplace Studies
Cornell/ILR School
16 E. 34th Street, 4th Floor
New York, NY 10016
Telephone: (607) 255-2703
Fax: (607) 255-9641
E-mail: smb6@cornell.edu
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# posted by SBasefsky : 12:46 PM
