KEY QUOTE: "Companies that offer employee health insurance expect another steep jump in medical costs next year, and more will ask workers to share a bigger chunk of the expense, according to a new PricewaterhouseCoopers report."
Report: Employers to see 2011 medical costs jump
Jun 14, 2:36 AM (ET)
By TOM MURPHY
INDIANAPOLIS (AP) - Companies that offer employee health insurance expect another steep jump in medical costs next year, and more will ask workers to share a bigger chunk of the expense, according to a new PricewaterhouseCoopers report.
For the first time, most of the American workforce is expected to have health insurance deductibles of $400 or more, the consulting firm said in a report released to The Associated Press.
Deductibles are the annual amount a patient pays out of pocket for care before insurance coverage starts. They are generally separate from co-payments and coinsurance.
Two years ago, only 25 percent of companies participating in the annual survey said they asked employees to pay deductibles of $400 or more. That grew to 43 percent in 2010 and is expected to pass 50 percent next year.
Employees who are asked to pay more through things like higher deductibles help keep cost growth in check because they use less health care.
The health care reform law passed by Congress and then signed by President Obama in March has just started to unfold and will have little impact on costs next year, said Michael Thompson, a principal with PricewaterhouseCoopers.
"In general, it's a continuation of a fairly high rate of medical inflation," he said.
PricewaterhouseCoopers found that medical costs are expected to rise 9 percent next year. But this doesn't mean workers will see their monthly premiums jump by the same amount.
Employers typically try to soften the impact of a cost increase by absorbing some of it, changing insurance plan designs or asking employees to pay higher deductibles or a larger coinsurance percentage.
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