Reform expected to add 1.1% to plan costs


The reform law will have little effect on medical and prescription costs for 2011, but other factors will push costs up 10 percent or more, says the 2011 Segal Health Plan Cost Trend survey. The Patient Protection and Affordable Care Act will have a modest effect: Preferred-provider organizations and point-of-service plans will have slightly higher costs, and high-deductible plans and indemnity plans, slightly lower.

Edward A. Kaplan, a senior vice president at Segal & Co., says that 2008 “was the bottom of a downward pattern, with costs returning to an upward direction in 2009. A short-term driver of health plan costs is the cost of compliance associated with the PPACA. More than three quarters of those we surveyed said that the act’s impact would result in an increase in overall health plan costs of more than 1 percent.” Seventy-eight percent expect an increase of 1.1 percent or more.

One consistency the survey identified is prescription drug costs for retail and mail order combined — the increases have remained below 10 percent for the last three years. Managed care organizations, health insurers, PBMs, and third party administrators took part in the survey.

The Patient Protection and Affordable Care Act’s effect on overall costs

Projected medical and prescription drug cost increases, 2010 and 2011

Source: 2011 Segal Health Plan Cost Trend Survey

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to jfedder1@hfhs.org or online at http://p.rfer.us/HENRYFORDlXqAJA

Subscribe to Our Newsletters

Monthly table of contents

Be notified as each issue of Managed Care is available online.

Biweekly newsletter

Recent topics have included:

PTCommunity news

New drug approvals, clinical trials, drug management. Three times per week.

UP NEXT

Managed Care
By Peter Wehrwein
Managed Care
By Howard Wolinsky