Survey Finds Average 8% Premium Increase
The consulting firm United Benefit Advisors is out with a new survey of more than 17,000 health plans from over 11,000 employers. The survey finds that premium rises for the coming plan year will average 8 percent. Moreover, one in four plans face a rise of at least 13.9%. As slide six of the Powerpoint presentation demonstrates, plans initially faced much higher premium increases, averaging 15.4% (and more than 20.8% for one in four plans). By negotiating with their insurance carriers, they were able to reduce that increase to “only” 8 percent.
However, it is as yet unclear what the impact of the new grandfathered plan regulations will play in these premium increases. Companies who relinquished grandfathered status in order to keep their premium increases to single-digit percentages (by, for instance, increasing co-pays or co-insurance) will find themselves subject to new benefit mandates that will raise their premiums still higher in future years. Small firms may however have been less inclined to change insurance companies during negotiations – making them a “captive” of their current carrier – because doing so would cause them to forfeit the benefits of grandfathered status, and subject them to new federal regulations (and thus new costs) in the future.