Survey: Employers look to CDHPs, wellness initiatives to curb health care cost increases

WASHINGTON — Many employers are expecting their health care benefit costs to rise about 6% in 2016, with many making changes that bring the cost increase down to 5%, according to a new survey by the National Business Group on Health. 

 

Some 70% of employers have curbed cost increase by focusing on employee wellness and 76% did so by adding or expanding consumer-directed plans. These moves are central to keeping the increases down is important as some 48% of employers surveyed are expecting one of their plans to trigger the Affordable Care Act’s “Cadillac” excise in 2018. The 40% tax on health coverage costs that exceed $10,200 for an individual and $27,500 for families will see those thresholds update in 2018. A further 72% of employers expect at least one of their plans to trigger the tax in 2020, with others following in 2021. 

 

Another place that has potential to keep costs down is telehealth, which 74% of respondents said they planned to offer their employees where it’s legal. 

 

“Rising costs have plagued employers for many years, and now the looming excise tax is adding pressure,” National Business Group on Health CEO Brian Marcotte said. “Employers only have two more years to bend the cost curve before the excise tax goes into effect in 2018. And while employers are pursuing several strategies to keep their plans under the excise tax threshold, they estimate their actions will only delay the impact by two to three years.”

 

Employers surveyed saw four main drivers of increased costs: high-cost claimaints, increasing prices on specialty medications, certain diseases and general inflation on medication prices. 

 

A potential solution is exploring private exchanges, something only 3% of respondents plan to do by 2016. Overall, though, fewer employers this year are exploring the private exchange option — 24% compared to 35% last year. However almost a quarter will offer retiree coverage through private exchanges. Additionally, though employers see private exchanges as potentially offering more plan choices, among other features, they are less confident in the private exchanges’ ability to keep costs down better than employer efforts can. 

 

“While we continue to see interest in private exchanges among large employers, there really hasn’t been much movement,” Marcotte said. “Employers need to do their due diligence, ask questions, and study the options closely. The jury is still out as to whether a private exchange can manage costs and care more efficiently than what employers are currently doing on their own.”