The bad news: employers’ health premiums doubled between 1996-2006. The good news? Employers health cost growth will slow in 2009 to 10.6%.

Good news? Huh?

I get the fact that 10.6% is slower growth than, say, 11.2%. But it’s still double-digit cost growth, isn’t it?

Aon Consulting opines that the 10.6% increase is the smallest in six years.

The firm’s forecast looked at 70 American health insurers. Aon points out that health costs increased over 16% in 2002.

The sanguine news will be short-lived, based on a caveat. Aon notes that since 2002, the declines in health cost increases are getting smaller every year. This may mean that positive results from employers’ current approaches to cost-containment may be played out.

Health Populi’s Hot Points: Why am I not-so-sanguine about the main stream press celebrating that the 10.6% is a good thing? Because of the latest research coming out of the Agency for Healthcare Research and Quality (AHRQ). This hard-working group mined the MEPS data set, looking at data from 1996 to 2006 (MEPS stands for Medical Expenditure Panel Survey, and collects details on the cost and use of health care and health insurance in the U.S.).

As the above chart illustrates, employers’ health plan premiums for employees’ families doubled between 1996 and 2006. Premiums also doubled for single employees over the decade. Thanks to Bob Isquith at AHRQ for this important analysis.

This is a huge baseline on which to expect a double-digit increase. While premiums aren’t health costs, per se — yes, I realize I’m comparing Empire apples to McIntosh ones — we can still recognize that the relative size of the cost increase will ultimately translate into a relatively large premium cost increase.

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