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Home / News & IndustryManaged Care Insight and Analysis
Updated: January 12, 2010
Where Employers Are Making Changes In Health Benefit Plan Features

Key areas where employers are working to reduce healthcare costs that changed between 2008-2009 include increases in co-pay’s, increases in family deductibles, and reductions in administrative fees for health savings accounts (HSAs), according to a report from HighRoads.

"As health insurance costs continue to skyrocket employers continue to work to find ways to reduce their overall healthcare costs while minimizing the impact on their employees," said Josh Miley, principal with HighRoads. "Based on live data from our benefits benchmarking tool, The Lab, employers continue to seek innovative solutions to solve their health insurance needs while maintaining overall cost control."

The Lab, which contains design and related cost information for over 5,000 medical plans, is used by plan managers to benchmark medical programs at a granular level in real time, the firm said.

Using recent data The Lab identified the following trends:

For HMO Plans:

  • Between 2008 and 2009, the median co-pay amounts increased by $5 for primary care and $10for specialty care to $20 and $30 respectively.
  • The median 2008 three-tier retail prescription co-pay of $10/$20/$37.50 (generic/brand formulary/brand non-formulary) increased to $10/$22.50/$40 in 2009.
  • These combined HMO design changes yielded approximately a 2 percent reduction in HMO premiums resulting in final median HMO increase of about 4 percent.

For PPO Plans:

  • The median specialty physician co-pay increased from $20 in 2008 to $27.50 in 2009. Primary care physician co-pays remained relatively unchanged at $20.
  • Prescription co-pays remained relatively unchanged with the exception of generic prescription drug co-pays which decreased from $10 to $7.
  • Employers are subsidizing dependent healthcare costs at a lower rate. The median family deductible increased from $600 in 2008 to $650 in 2009.
  • These combined PPO design changes yielded approximately a 1 percent reduction in PPO premiums.

The study also found that self-insured employers saw a slight 3 percent increase in median per-employee-per-month (PEPM) administrative fees.

Also, as high deductible health plans coupled with health savings accounts have increased in popularity their associated administration fees have decreased from over $4 PEPM in 2007 to a median of $3.25 PEPM in 2009, the study found.

A copy of the complete report on HighRoads` benchmark findings and observations is available online at

The company said The Lab allows users to track market trends and accurately pinpoint the underlying factors driving them. Real plan and cost information is added to the benchmark on an ongoing basis, covering a range of market industries and company demographics.

Address: HighRoads, 150 Presidential Way, Woburn, MA 01801; (781) 503-4000,,

  This article was taken from:
The Executive Report on Managed Care

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