Your Incredible Shrinking Health Plan
By Thomas Mangan
CEO, United Benefit Advisors
Whatever your view of the massive law that is The Affordable Care Act, there is no denying that it is having a big impact on the market. As we sifted through the enormous amounts of data that comprise the 2013 UBA Health Plan Survey, the reality of the law's impact became clearer. In short, if you are a single employee without dependents who is mostly healthy, you likely saw your health care costs decrease. If you're anyone else, you probably felt a punch below the belt.
On the positive side, for the first time in my 22-year career in the health insurance industry, this year we saw employers take back some of the premiums they have been asking employees to pay - a good sign the economy has improved and employers are concerned with attracting and retaining top talent. Unfortunately, dependents are being asked to pick up more of the tab, which could signal an increasing anti-family trend.
While employers covered 18 percent more of a single employee's health insurance premium, or $934 per employee, this year, they asked employees with dependents to pick up 3 percent more of the family premium, $492 on average. The average worker, however, saw an overall increase in health care cost due to rising out-of-pocket costs, including higher in-network deductibles, in-network co-insurance and significantly higher out-of-pocket maximums.
In-network deductibles increased $91 to $1,852 for a single and $216 to $4,225 for a family. Out-of-pocket maximums (after the deductible) for in-network increased $152 to $3,641 for a single and $433 to $8,043 for a family - increasing more than 17 times from five years ago. The survey also shows that the average in-network co-insurance dropped from 90 percent to 80 percent, a significant decrease in coverage.
Other important trends from the survey show:
1. PPOs continue to be the most popular plan type offered, up from 46.9 percent in 2012 to 47.2 percent in 2013. The number of HMOs decreased slightly, from 19.1 to 18.4 percent. CDHP plans grew the most from 22.5 to 24.1 percent for all industries and all size groups.
2. Self-insurance has increased 10 percent this year as a funding option for insurance plans.
3. Though other plan components hit employees and families hard, co-pay increases didn't materially impact them: The average PCP copay went from $25 to $26, specialist co-pay rose from $36 to $37, urgent care co-pays held steady at $52 and the ER co-pay rose $9 to an average of $152.
4. Families got hit the hardest with cost increases -- that is, if they even have coverage through their employer: Only 48.4 percent of health plans offer dependent coverage, which was only a .4 percent increase from the prior year.
Data in the 2013 UBA Health Plan Survey are based on responses from 10,551 employers sponsoring 16,928 health plans nationwide. This unparalleled number of reported plans is nearly three times larger than the next two of the nation's largest health plan benchmarking surveys, combined. The resulting volume of data provide employers of all sizes more detailed -- and therefore more meaningful -- benchmarks and trends than any other source.
For further information about the 2013 Health Plan Survey, request a copy online or contact a local UBA Partner for a customized benchmarking report.