News & Information

 

FEATURED PRODUCT

5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.

Learn More »

CCH® BENEFITS — 12/08/08

Milliman Survey Says 2009 Cost Increases To Range From 8.4% To 12.%

From Spencer's Benefits Reports: HMOs and fully insured preferred provider organizations estimate rate increases for 2009 renewals at 8.4%. High deductible health plans (HDHPs) for PPOs are expected to increase 10.7%, and lower deductible health plans for PPOs are expected to increase 12.1%, according to Milliman’s 2008 Group Health Insurance Survey. The premium increase from July 2007 to July 2008, not including any changes in benefit or cost-sharing levels, was 9.7% for HMOs, 10.3% for HDHP PPOs, and 10.7% for lower deductible PPOs.

The average premium savings obtained by changing from a $250 deductible to a $1,000 deductible is nearly 12%, and by switching to a $2,000 deductible, the savings increase to 20%, Milliman found. HDHPs are the foundation of account-based consumer-driven health plans (CDHPs), with either a health reimbursement arrangement (HRA) or a health savings account (HSA). CDHP business growth is expected to continue in 2009, with PPOs anticipating that these plans will represent 6% of their income in 2009.

According to Milliman’s Medical Index, a typical American family of four faced a total medical cost of $15,609 in 2008, compared with $14,500 in 2007, an average increase of 7.6%. Costs varied widely across the country, by more than 35% from the lowest to the highest among the 14 metropolitan areas studied. The prescription drug cost growth rate rose for the first time since 2006. In addition, for the second consecutive year, in 2008, employees’ cost share for health care services rose in the double digits.

The survey may be purchased for $4,000 ($1,000 for Milliman clients). For further information or to purchase the survey, contact Chris Wanta via e-mail at chris.wanta@milliman.com.

Visit our News Library to read more news stories.