Costs in employer health benefit plans are projected to increase by 4.1% in 2019, according to early data from the Mercer National Survey of Employer-Sponsored Health Plans.
The increase is on par with this year's growth of 4.2% and generally in line with the low single-digit increases employers have seen over the past decade.
As Mercer noted, those increases could have been higher had employers not shifted costs to their employees through high-deductible plans."The things you can do to get a short-term, you know, a quick-hit improvement in your medical trend, usually involve what we call cost-shifting," said Beth Umland, director of research for health and benefits at Mercer, in an interview with FierceHealthcare.
"So, you raise the employees' deductible so that some of the costs that would have hit the employer are going to go out there as additional out-of-pocket costs for employees," she said.
For 2019, those cost-sharing techniques brought the expected trend down from 5.3%. It was a move in the right direction but a smaller reduction than what cost-sharing achieved in previous years.
That appears to be in part because the expected trend itself is slowing.
"The cost growth is slowing even before employers do stuff like cost sharing to their employees—like raise deductibles or move them into high-deductible HSA plans," Umland explained.
So what's slowing the trend and bending the cost curve for employers? In casting about for answers, Mercer arrived at the "point solutions" large employers have started providing for their employees.
These "high-tech, high-touch programs" are generally purchased from a vendor that specializes in a particularly acute health issue. Some early examples included infertility treatment, diabetes management and back pain support; the hope being that by assisting employees with those conditions, some of their healthcare costs could be deferred.
"When you look at a lot of the new strategies—more innovative strategies that aren't about cost-sharing—they involve technology," Umland said. "So like with diabetes, now we can do this remote monitoring of, you know, blood sugar levels. And the goal being: keep the employee out of the emergency room. It's better for them, and it's way better for costs. So these programs are becoming increasingly common, but what we're seeing is it's branched out from just diabetes to a whole range of conditions that really deserve the kind of extra attention of these targeted programs."
Of course, healthcare costs are affected by so many different inputs that it can be hard to tease out the exact impact of specific programs like these. But Mercer has collected several case studies to show how effective such point solutions can be.
For instance, the firm noted how one company saw high maternity costs and found users of infertility services had a much higher rate of high-cost newborn claims, including multiple births, pre-term births and “avoidable C-sections.”
But by working with a specialty vendor working on infertility issues who was focused on outcomes and reducing costs, they were able to reduce multipl-birth pregnancies among employees to less than 3% of users of infertility services versus a national average of 22%.
“Even factoring in spending more on infertility services, the service leads to increased savings while also improving women’s and newborns’ health," the case study noted (PDF).
One caveat about Mercer's findings: the cost increase estimated for next year is just preliminary—the data still needs to be weighted for national averages. So it's conceivable the exact increase will change when Mercer releases its full results later this year.
"It's just the first responders, but we always like to provide kind of like an early peek at what the numbers are looking like, cause you know, this is high time and high interest for that," said Bruce Lee, principal and U.S. leader of public relations at Mercer, in an interview with FierceHealthcare. "But in about a month and change we'll have much more data, much more cuts and slices and dices and geographies and things like that."