Health benefits survey reveals changes in plan design

The annual Medical and Prescription Drug survey from Harrisburg-based Conrad Siegel Actuaries, released Tuesday, showed that employer premium sharing continues to remain consistent in 2015, demonstrating that employers may be changing the benefit design instead of shifting more premium costs to employees.

The average percentage of the medical premium that employees paid in 2014 was 15 percent, and the average percentage of the medical premium paid for employee plus dependents was 21 percent, the firm said.

Conrad Siegel partner Rob Glus said, "As we continue to see health care costs increase, employers are more prone to reduce benefits rather than passing costs on to employees through payroll deductions. To a degree, this may be in response to concerns over the impending impact of the Cadillac Tax. To mitigate the increasing costs, many employers are taking on more risk with self funding, cutting back on spousal coverage and encouraging employees to better manage their costs through consumer directed plans.”

The survey also showed that self-funded arrangements for medical plans have increased over the past year and for the first time are more prevalent than fully insured plans.In self-funded arrangements, groups take more risk by paying the cost of their claims plus an administrative fee.

According to the survey, 52 percent of plans are self-funded and 48 percent of plans are fully insured. In 2013, employers reported that 40 percent were self-funded and 60 percent of plans were fully insured. The increase may be in response to the Health Insurers Tax (HIT) on insured plans, which is not assessed on self-funded plans, Conrad Siegel said.

Elsewhere in the survey, approximately 47 percent of employers are either charging spouses more to be covered or are not allowing them on a plan if they have access to coverage through their own employer. Thirty one percent of employers do not cover spouses who have coverage available through their own employer, which is up from 25 percent in 2013 and from 20 percent in 2012. Of the 69 percent of employers that will cover spouses who have health insurance available through their own employer, 16 percent require a surcharge.

As for consumer-directed health care, the survey showed an increase in the number of companies offering health spending accounts in conjunction with a qualified high deductible health plan to their employees.

They survey said 20 percent of employers offer a health savings account to their employees, with 73 of those funding at least part of the account; 21 percent of employers offer a health reimbursement account or a medical expense reimbursement plan, with 96 of those funding at least a portion of the deductible; and 47 percent of employers offer a flexible spending account.

More than 130 companies of all sizes responded to the survey with 60 percent coming from organizations with more than 100 employees. Companies that responded to the survey were from a range of industries, including education, health care, social assistance, government, manufacturing and finance.

Source: Central Penn Business Journal