Total healthcare benefits costs, including both employer and employee contributions, rose 7.5% to $6,679 per employee in 2004, up from $6,215 per employee in 2003, the smallest increase in the past five years, according to a survey by Mercer Human Resource Consulting. By comparison, healthcare benefits costs rose 10.1% in 2003 and 14.7% in 2002. Survey results were projected to all U.S. employers that offer health insurance and have at least 10 employees. The drop in the rate of growth was attributed to continued, although lessened, cost shifting to employees through higher deductibles and copayments, which dampened healthcare usage; better pricing by insurance companies; increased use of consumer-directed health plans; and delayed effects from disease-management programs.
Looking ahead, adoption of consumer-directed health plans is expected to grow rapidly beyond the current 1% of all employers that offer them, Mercer said. Fourteen percent of employers with 500 or more employees said they likely would offer consumer-directed health plans in 2005, and 26% said they likely would offer such plans in 2005 or 2006. Just 4% of large employers currently offer consumer-directed plans, Mercer said. Read the firm's news release on the survey. -- by Paul Barr