U.S. employers' health-care costs are projected to rise 6% next year, or two-thirds more than the consumer price index, according to a Towers Perrin survey released Tuesday.
The projected increase would exert stress on businesses striving to maintain adequate coverage for their employees, the Stamford, Conn., management consulting firm said. Next year's gross health care expenditure is expected to rise by an average of $518 per employee, to an average cost of $8,748. Employers are expected to pay 78% of this cost, and employees 22%, plus use-based copays, deductibles, and coinsurance.
The 2007 projection is for a fourth year of slower growth rates, but health-care costs have risen more than 60% in the past five years. The survey's results suggest that, with cost increases persisting well above the overall inflation rate, affordability for both businesses and employees could become a bigger issue as baby boomers age and chronic diseases like diabetes proliferate.
At the same time, however, the company said, its survey found wide variation in per-employee costs among similarly sized companies. This suggests that some companies have succeeded at controlling cost increases through a variety of benefit management initiatives, Towers Perrin said.
