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Health care industry

2009 Health Plan Cost Increases: A National Perspective

Strategic Insights

— 1 min read

The 2009 health plan cost increases varied across different types of health plans, with the weighted average increase being 11 percent at PPOs and HMOs, 10.2 percent at POS plans, and 10.4 percent at HDCD plans. This information is crucial for controllers to evaluate the 2009 health plan cost increases of their employers. The Buck Consultants' National Health Care Trend Survey, published in its newest survey, provides a comprehensive analysis of these cost increases.

Key Takeaways:

  • The weighted average increase for coverage is 11 percent at PPOs and HMOs, 10.2 percent at POS plans, and 10.4 percent at HDCD plans.
  • The most common 2009 increase for PPOs was 11 percent (16.5 percent of respondents with PPOs as their principal plans), which equals the average increase for this coverage.
  • The distributions in the table provide an unusual frame of reference for evaluating health care cost increases, with 21.2 percent of companies with HMOs as their primary coverage negotiating 10 percent increases.
  • This Buck survey shows medical plan cost increases settling into a steady pattern, following an approximate one-point cost dip in 2006.
  • The pattern of cost increases across different types of plans is as follows:

+ PPOs: up 12.7 percent in the first half of 2006, 10.6 percent in the first half of 2007, and 11.1 percent in the second half of 2008.

+ HMOs: up 11.1 percent, 11.1 percent, and 11.1 percent.

+ POS plans: up 12 percent, 10.6 percent, and 10.8 percent.

+ HDCDs: up 12.3 percent, 11.1 percent, and 10.7 percent.

Statistics:

  • Weighted average increase for coverage: 11 percent at PPOs and HMOs, 10.2 percent at POS plans, and 10.4 percent at HDCD plans.
  • Most common 2009 increase for PPOs: 11 percent (16.5 percent of respondents).
  • Percentage of companies with HMOs negotiating 10 percent increases: 21.2 percent.
  • PPO cost increases: 12.7 percent in the first half of 2006, 10.6 percent in the first half of 2007, and 11.1 percent in the second half of 2008.
  • HMO cost increases: 11.1 percent, 11.1 percent, and 11.1 percent.
  • POS cost increases: 12 percent, 10.6 percent, and 10.8 percent.
  • HDCD cost increases: 12.3 percent, 11.1 percent, and 10.7 percent.

Sources:

  • Buck Consultants, National Health Care Trend Survey.

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