Benefits March 8, 2001

Despite Rising Health Costs, Employers Stay Involved

March 8, 2001 (PLANSPONSOR.com) - Most large employers plan to maintain a central role in providing healthcare to their employees despite rising costs, but they may do so in different ways, according to a new study.
Reported by

According to the Sixth Annual Purchasing Value in Health Care Survey, more than 75% of employers will stay involved in health plan design and vendor selection, while nearly two-thirds (65%) will remain involved in pricing of options and providing information to employees about their plan choices.

Net Difference

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Eighty percent of survey respondents plan to make more use of the Internet in administering and distributing health plan information, including:

  • 92% – provide employees information on plan choices
  • 87% – annual enrollment
  • 83% – help employees navigate delivery system
  • 81% – health promotion & wellness
  • 81% – educate employees about self care
  • 76% – plan administration.

Overall health care costs increased 10.3% this year, with the cost of prescription drugs topping the list with a 14.6% increase.  Roughly 70% of employers will deal with these cost increases by increasing employee premiums, while half will increase employee co-payments.  Still, about half will absorb at least some of the increase, and just 14% plan to reduce or eliminate coverage.

The study also found:

Eight in 10 are looking to improve employer/employee benefits communications to improve employee satisfaction over the next year.  Fifty-five percent hope to improve online plan information and transaction processing.

One in five plan to move toward more aggressive managed care – while a like number are planning to use less aggressive managed care

The survey represents the experience of 360 employers covering 4.7 million full-time employees, and was conducted by Watson Wyatt Worldwide, the Washington Business Group on Health and the Healthcare Financial Management Association.

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