What comes as good news for the country as a whole will likely leave a few workers disgruntled.
The rise in the costs of employer-based health insurance has slowed dramatically, but it appears to largely be the result of a rise in high-deductible health plans.
Employers are spending an average of $11,920 per employee on health insurance this year, according to a study released this week by Mercer, the benefit consulting firm, which based the findings on a survey of more than 2,500 employers. That amounts to a rise of only 2.4 percent over the previous year, when costs rose by 3.8 percent.
That suggests employers were pleasantly surprised, since in the same survey last year employers foresaw an average cost increase of 4.2 percent.
Employers responding to this year’s study similarly projected that they will see an average increase of 4.1 percent in the price of per-employee health costs next year.
In keeping with trends, the percentage of employees with high-deductible plans — above $1,300 for individual coverage or $2,600 for family coverage — rose from 25 percent to 29 percent in 2016.
The cost of health benefits would have risen more if employers had not made adjustments to their insurance policies.
|Trend in shifting cost to employees
In a preliminary projection of future cost growth that Mercer released last month, it reports while the cost of health benefits is expected to increase by roughly 4 percent next year, it would rise 5.5 percent if employers didn’t redesign their plans.
The difference between the “underlying cost growth” and the real cost growth is not expected to be as great in 2017 as in past years.
Over the past eight years, as employers have aggressively shifted a greater share of health costs onto workers, the average difference between the two figures has been 3 percent. Next year is expected to be the first year when the difference is less than 2 percent.
Some analysts attribute the rise in high-deductible plans to an attempt by companies to avoid getting hit by the “Cadillac Tax,” a controversial provision of the Affordable Care Act that was intended to go into effect in 2018 but whose implementation was suspended by another two years as part of a budget bill approved by Congress last year.
The provision would levy a 40 percent excise tax on health plans worth more than $10,200 for individuals or $27,500 for families.
It is very likely, however, that the Cadillac Tax will once again be suspended or scrapped entirely before it is scheduled to go into effect in 2020.
The push to suspend the provision, which the Obama administration and many economists applauded as a way to push down health spending, earned bipartisan support.
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