Employers' Health Costs to Rise More. (Briefing).Health-care costs for large employers will increase by an average of 14% next year; the third straight year of double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. increases, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. a survey by health-care consultant Towers Perrin Towers Perrin is a global professional services firm. It was established 1 March 1934 as Towers, Perrin, Forster & Crosby. The umbrella name of Towers Perrin was adopted in 1987. . Health-care costs, which are about $5,000 for an individual annually, are expected to rise to about $5,700 in 2002, said Ron Fontanetta, a principal in Towers Perrin's New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of office. "Employers and employees split that cost, with employers covering about 80% and employees covering about 20%," Fontanetta said. "So we expect the employees' costs to also go up by at least 14%." Towers Perrin estimates monthly health-care costs will be $661 in premiums for active employees with families in 2002, up 13% from 2001. Retirees under age 65 with families will cost $805, also a 13% increase. Medicare-eligible retirees will cost an average of 19% more than in 2001, whether the coverage is for a single employee only or for an employee and spouse spouse A legal marriage partner as defined by state law . The estimated 14% increase for health costs for 2002 would be in addition to a 13% increase in 2001 and a 12% increase in 2000. Employers are taking several steps to reduce their costs, including increasing cost sharing with employees through increasing monthly contributions, deductibles and copayments; restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). benefit offerings; targeting disease management; and using technology to improve information to employees, the survey said. The primary drivers of the overall increase cited in the report are the rising costs of prescription drugs prescription drug Prescription medication Pharmacology An FDA-approved drug which must, by federal law or regulation, be dispensed only pursuant to a prescription–eg, finished dose form and active ingredients subject to the provisos of the Federal Food, Drug, , which are expected to increase by 15% to 17% in 2002; escalating health maintenance organization premiums, which are increasing by 12% to 14% on average, and increases in fees paid to hospitals and physicians, Fontanetta said. Health-Care Costs The cost of large employers' health-benefit plans could increase about 14% on average, according to Towers Perrin. Health-Care Plans 1998 1999 2000 2001 2002 (*) Active employees 4% 7% 10% 12% 13% Retirees under age 65 4 6 10 17 13 Retirees age 65 and older 5 10 10 18 19 Combined 4% 7% 12% 13% 14% (*)Projected Source: Towers Permin Health Care Cost Survey |
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