Yes, Another Study Demonstrating That HC Costs are Still on the Rise

Towers Perrin, an HR consulting Firm just released their annual HC Cost Survey for 2009. And while it seems that there is a similar study released every week, all of them telling us what we already know, the Towers HC Cost Report is widely used and respected in the industry.





The new data suggests that employers will pay, on average, $9,552 per employee for health benefits in 2009, a jump of 6% from 2008. Yet some employers will buck the trend because they proactively manage their benefit programs.

One interesting nugget of data reveals that "high-performing companies," or those organizations that rigorously track their health benefit objectives, will spend on average, 12% less in annual health care premiums in 2009, compared to low-performing companies. For example, high-performing firms report health benefits costs $8,904 per employee, compared to $10,104 for low-performing companies. The cost fell even lower (to $7,032) at high-performing companies utilizing consumer-driven health plans with health savings accounts. (Still not convinced about CDHP?)

The survey defined high performers as companies that not only had a strong commitment to improving employee health and engagement, but also aggressively managed their health plans and the delivery process.

Other Findings Within The Study:

• Large employers are experiencing health care cost increases of 6% on average, or $532 per employee per year. Although this year's average percentage increase is similar to last year's, employers are paying 29% more today than they spent five years ago for health care.


• In flat dollar terms, the employee share in 2009 will average $80 per month ($960 annually) for employee-only coverage and $273 per month ($3,276 annually) for family coverage - a significant cost for many employees.


• Pre-65 retirees will contribute approximately 51% of the premium for retiree-only coverage, and 54% for family coverage.


• Retirees age 65 and older will pay an average of $148 per month (or $1,776 annually) for retiree-only coverage and $309 per month (or $3,708 annually) to add coverage for one dependent.

Follow the link above to read the study for yourself.

-JS