Posted by: Bill von Achen | April 29, 2011

Results from our 2011 Healthcare Insurance Survey

Rising healthcare insurance costs continue to be a hot topic among our clients, with many of you once again reporting proposed increases of 20-30% in your monthly premiums.  Such annual increase are clearly not sustainable, and many business owners are already taking steps to reduce insurance costs through a variety of mechanisms, including increasing their healthcare insurance plans annual deductibles.   

I believe that having information about where your healthcare insurance premiums stand relative to other employers is an important first step in determine how best to address this major business expense.  So, I’d like to share with you some of the summary results of our recently completed 2011 survey on healthcare insurance plans at our client companies.

As in prior years, our survey includes insurance premium data from businesses in Eastern Massachusetts, covering insurance carriers, premiums for both single and family coverage, and percentages of premiums paid by employees.  Here are the survey highlights:

Provider Breakdown: Tufts was the #1 carrier choice among survey respondents, taking over the top spot from 2010 leader Blue Cross Blue Shield.  39% of respondents listed Tufts as their current health insurance carrier, with 35% naming Blue Cross Blue Shield, and 22% naming Harvard Pilgrim.

 (Blue Cross Blue Shield continues to lose ground as the health insurance carrier of choice. Last year, nearly 40% of respondents listed BCBS as their current carrier.  This year, 59% listed BCBS as their previous (not current) carrier, and those respondents who switched carriers within the last two years cited efforts to control costs as the primary reason.)

Plan Types: 78% of all companies offer an HMO insurance plan, while 61% offer a PPO plan (some companies offer multiple plans).

Plan Options: 55% of responding companies offer their employees more than one choice of health insurance coverage (down from 68% in 2010, but comparable to 56% in 2009).

Minimum Office Co-Pay Amounts: Plans at 41% of responding companies charge employees a minimum $20 co-pay for office visits (down from 61% in 2010 and 2009); plans at 27% of companies charge $25 per office visit (up from 22% in 2010); and plans at 23% of companies charge $15 per office visit (up from 13% in 2010).

Annual Deductibles:  A surprising 36% of respondents have annual per person deductibles or more than $1000 per person, compared with just 13% in 2010.  23% have annual per person deductibles of $1000 per person (compared with 26% last year), and an 18% have $500 deductibles.  However, 45% of respondents indicate that they reimburse employees for at least a portion of their annual deductible payments (comparable with 2010’s 46%).  Two companies provide their employees with plans that require no deductibles.

Incentives to Obtain Insurance Elsewhere: Just 14% of respondents offer employees an incentive to secure health insurance coverage from another source (such as a spouse’s employer’s plan), compared with 27% in 2010

Monthly Premiums, Single Coverage: Insurance premiums for single coverage now average $350 or more per month, with 82% of responding companies quoting monthly premiums at or above this threshold. 64% of companies pay $400 or more per month (compared with just 39% in 2010), and 23% pay $500 or more per month (compared with 17% in 2010).

Monthly Premiums, Family Coverage: 96% of respondents now report monthly insurance premiums for family coverage at or above $900 per month.  (In 2010, 96% of respondents reported monthly family premiums at or above $800, $100 less than this year.).  77% of respondents pay $1000 or more per month for family premiums. 27% of responding companies pay between $1200 and $1299 per month, the largest concentration of expenses for this question.  (In 2010, the largest concentration of respondents, 26%, paid between $1000 and $1099 per month for family premiums, $200 less than this year.)

Two Person ‘Families:’ Only 41% of responding companies report that they offer their employees coverage for 2 person families, down from 49% last year.  Monthly premiums vary widely for this coverage.

Employer Contributions, Single Coverage: 100% of responding companies contribute at least 50% of the premium cost for single coverage (the same as in 2010 and 2009). 14% of responding companies contribute 90% or above (compared with 17% in 2010 and 2009), 18% of companies contributing between 80-89%, and 41% of companies contributing between 70-79% (the largest concentration of responses for this question).

Employer Contributions, Family Coverage: Companies continue to be less generous when it comes to contributing to the premium cost for family coverage. Only 5% of companies contribute 90% or more of monthly family premiums (compared with 13% in 2010 and 9% in 2009), while 23% contribute between 80-89%, 32% between 70-79%, 23% between 60-69%, and 14% between 50-59%. Only one responding company contribute less than 50% of the premium cost for family coverage (compared with none in 2010).

 Although our sample of companies for this survey is small (less than 50 companies contributed data to this year’s survey), I’d be interested in hearing how closely your company’s health insurance coverages track with the above results. Thanks!

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