High deductible health plans (HDHPs) continue to grow in popularity as we enter 2016. Several factors are influencing employers’ group benefit choices as they look to reduce health plan costs over the next several years. Companies all took a look at their percentage increase in health plan costs last year and considered what plan design changes, including moving to HDHPs made sense for them this year.
Many end-of–the-year employer benefit surveys found that companies made efforts to tweak their plan designs, but didn’t make many sweeping changes. According to the HTI 2016 Healthcare Benefit Trends Benchmark Study, most companies appeared to be waiting to see if the Cadillac Tax would be repealed, and at the very least knowing they had more time as the tax is now delayed until 2020 before considering making any major healthcare changes.
The move most companies agreed upon was the value of offering a HDHP. The 2015 Willis Towers Watson/NBGH Best Practices in Health Care Employer Survey reported that 86 percent of employers were looking to offer a CDHP in 2016 and more than one-third will make that the only plan available to employees.
Employer decisions like moving to HDHPs are helping to produce relatively small health care cost trend over the past couple years. According to an Aon Hewitt November 2015 Study, health care costs increased 3.2%, last year, down from 4.4% in 2014.
The financial incentive of lower claim costs and premium costs holds appeal to employers and employees alike. Helping make them even more attractive is the pretax contributions to HSAs and HRAs. According to the NBGH study, 58% of employers remain committed to contributing a predetermined amount to HSA enrollees and 59% will continue doing so for those enrolled in HRAs in 2016.
Movement from employers clearly remained incremental throughout 2015 into 2016. Continued efforts to keep healthcare costs in check and determine ACA reform guidelines will further determine employers’ mindsets regarding plan design and account based offerings in the future.
Source: Business Insurance. High-Deductible Health Plans Surge In Popularity. 1/4/2106. Vol. 50, Issue 1. P18.