Employers Project Health Premium Hike of 6% in 2017

8/22/2016
Stephen Miller, CEBS

Health care benefit cost increases at large U.S. employers are expected to hold steady at 6 percent in 2017. The good news is that health premiums are not growing at a faster clip year after year, as they were a decade ago. The bad news is that the increase in health plan costs still outpaces general inflation in the U.S., which remains below 2 percent, and salary budget increases, which are holding at around 3 percent.

"While employers have been able to keep increases in check for the past few years, costs are still running at more than twice the rate of inflation and general wage increases, thereby threatening affordability," said Brian Marcotte, president and CEO of the National Business Group on Health (NBGH), a membership association of primarily large U.S. employers.

"Controlling health benefits costs remains a high priority" for corporate management, Marcotte said on Aug. 9 when NBGH released the findings from its Large Employers' 2017 Health Plan Design Survey at a press conference in Washington, D.C.. The survey was fielded among NBGH members in May and June, with responses from 133 large U.S. employers offering coverage to more than 15 million Americans.

According to the survey, the 6 percent increase projected for 2017 is identical to the increase employers would have experienced in each of the past two years had they not made changes to their plan design. But many employers expect to hold increases to 5 percent by making some changes to their plans.

And compared with plans available on the Affordable Care Act's public exchanges, employer-based group coverage is a deal.

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