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When comparing projections for 2011 to actual increases, Segal found that insurers and pharmacy benefit managers (PBMs) tend to make conservative projections for cost increases. In 2011, actual medical and prescription drug trend rates were significantly lower than projections. For example, the actual trend rate for PPOs for actives and retirees younger than 65 was 7.5%, while the projected PPO trend rate was 11%. Segal said the deceleration in medical plan costs trends is likely the product of several forces, including plan designs that encourage use of lower-cost providers, greater shift to generic drugs and less intensive treatments, and improved medical management efforts, such as greater investment in hospital-discharge coaching. Full results of the 2013 Segal Health Plan Cost Trend Survey are at http://www.segalco.com/publications/surveysandstudies/2013trendsurvey.pdf. An online supplement to the report features a graph that shows selected actual and projected trend data from the last 13 surveys and another graph of selected medical trends for actives and retirees younger than age 65. The supplement is at http://www.segalco.com/publications/surveysandstudies/2013trendsurveysupplement.pdf.
When comparing projections for 2011 to actual increases, Segal found that insurers and pharmacy benefit managers (PBMs) tend to make conservative projections for cost increases.
In 2011, actual medical and prescription drug trend rates were significantly lower than projections. For example, the actual trend rate for PPOs for actives and retirees younger than 65 was 7.5%, while the projected PPO trend rate was 11%.
Segal said the deceleration in medical plan costs trends is likely the product of several forces, including plan designs that encourage use of lower-cost providers, greater shift to generic drugs and less intensive treatments, and improved medical management efforts, such as greater investment in hospital-discharge coaching.
Full results of the 2013 Segal Health Plan Cost Trend Survey are at http://www.segalco.com/publications/surveysandstudies/2013trendsurvey.pdf.
Rebecca Mooreeditors@plansponsor.com