National Survey of Employer-Sponsored Health Plans 2017

Employers Can Make Strides Toward Better Healthcare: Health Benefit Survey Results

Mercer’s annual US survey highlights trends in employee health benefit costs, design, and strategies.

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Empowered Employees, Focus on Value Help To Slow Cost Growth:
4 Survey Takeaways

Reducing healthcare inefficiency and improving care quality requires creative strategies and ingenuity.

For over 30 years, employers of all sizes have used Mercer’s National Survey of Employer-Sponsored Health Plans to create data-driven health and benefits strategies to better manage cost, promote quality care, and improve member experience.

  • Employers make progress in tackling benefit cost growth: Employers’ hard work is helping to stabilize health benefit cost growth. The average total health benefit cost per employee rose a modest 2.6% in 2017. Of course, behind the average, actual experience ranged from flat or decreased cost for over a fourth of employers to increases of greater than 10% for more than a third. But the trajectory is encouraging: Over the past 5 years, cost has risen by an average of 3.3% annually, compared to 6.2% during the prior 5-year period.
  • Empowered consumers make smarter health decisions: Employers are empowering people with tools and resources to care for their health and make better healthcare decisions. “Transparency tools” (now offered by 82% of employers with 500+ employees) help consumers compare healthcare prices and quality, while telemedicine provides a low-cost alternative to an office visit (offered by 71%).
  • Focus on employee choice informs high-deductible health plan strategies: In 2017, 30% of all covered employees enrolled in a high-deductible consumer-directed health plan (CDHP). That’s nearly flat from 2016. One reason for slowing enrollment growth is that most employers remain committed to providing choice: just 10% of employers with 500+ employees offer a CDHP as the only medical plan at their largest worksite.
  • Businesses actively take on soaring drug prices: Rising drug prices, especially for specialty drugs, remain one of the biggest cost drivers—and with hundreds of specialty drugs in development, it will only get worse. Businesses are turning to new strategies and healthcare innovations to address this and other serious challenges posed by the US healthcare system.
of employers with 500+ employees now steer members to a specialty pharmacy to help combat soaring drug costs.
of employers with 5,000 or more employees now offer a second medical opinion program that is usually free of cost.
Did you know?
Telemedicine is growing in response to consumer calls for more choice: 71% of employers with 500 or more employees now offer these services, up from 59% last year.
Health advocacy services, which provide employees with personal guidance in how to find the right healthcare provider, compare costs, and resolve claims problems, are offered by about half of large employers.
Transparency tools, online resources that let members compare health provider prices and quality ratings, are provided by 82% of employers with 500+ employees.
Coverage costs about 20% less, on average, in an HSA-eligible CDHP, than in a traditional PPO plan or HMO, among large employers.
ACOs are promoting quality: Delivery systems promoting alternative provider payment methods—like accountable care organizations (ACOs), patient-centered medical homes (PCMHs), and centers of excellence (COEs)—are gaining popularity. Aiming for improved quality and customer satisfaction, employers are incentivizing workers to select proven care providers.

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Find out more about the benefits challenges keeping employers up at night with this year’s National Survey of Employer-Sponsored Health Plans news release..

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Employer Strategies Tame Healthcare Cost Growth

Employers are using a range of new tools and creative strategies to engage employees, improve healthcare experiences, and address growing costs—and it’s working. Employer health benefit costs grew just 2.6% in 2017, the sixth straight year of increases at or below 4%. A noteworthy add-on: This year’s low cost growth came even as fewer employees moved into high-deductible plans.

Source: Mercer’s National Survey of Employer-Sponsored Health Plans; Bureau of Labor Statistics, Consumer Price Index, U.S. City Average of Annual Inflation (April to April) 1993-2017; Bureau of Labor Statistics, Seasonally Adjusted Weekly Earnings from the Current Employment Statistics Survey (April to April) 1993-2017.

Behind the Cost Average, Employer Experience Varied Widely

Percentage of employers reporting % change in total health plan cost per employee from 2016-2017

Cost increased more than 10%
Cost increased 6% - 10%
Cost increased 5% or less
No change in cost or cost decrease