Employers Methods for Containing and Reducing Costs Vary By Region

September 27, 2008    

The Benefits USA 2008/2009 survey of more than 5,500 benefit plans found 68.3 percent of organizations nationally use wellness programs to contain costs, while 35.6 percent are increasing the employee portion of the premium.

Kansas City, Kan. – Employers are utilizing a mix of cost containment and cost reduction measures to combat rising health care costs. The Benefits USA 2008/2009 survey of more than 5,500 benefit plans found 68.3 percent of organizations nationally use wellness programs to contain costs, while 35.6 percent are increasing the employee portion of the premium. Although these trends are prevalent across the country, the report showed increased usage of these methods in the South and Central regions and decreased in the West and East.

Wellness programs have garnered media attention as many organizations are utilizing this method to contain health care costs nationally. Companies in the Midwest have the highest percentage implementing this method, 70.4 percent. Those in the West have the lowest, 63.8 percent. Nationally, the most offered wellness option is flu shots/immunizations. Tobacco cessation and health risk assessments follow with both offered by about one-third of the organizations surveyed. One of the most discussed new tactics, weight management, is offered by just over 20 percent.

While wellness programs are popular, their effects are not immediate, causing some organizations to choose additional methods to alleviate growing costs. Nationally, 18.1 percent of organizations offered a choice of deductible levels. When compared to each region, the South has the highest percentage, 21.6, and the East has the lowest, 13.6 percent. On a national level, 67.4 percent are coordinating benefits to contain costs. This method varies largely by region, as 71.7 percent of organizations in the Midwest utilize it and 58.5 percent in the West.

Although organizations continue to pass costs onto employees, fewer companies are reducing benefits. The East has the lowest percentage of organizations utilizing this method, 4.9 percent. The Midwest and West follow with both at 5.3 percent. The South Region had the highest percentage, 5.6 percent.

About the Survey
Benefits USA 2008/2009 analyzes national and regional data on benefits eligibility and administration policies with detailed information on benefit plans, premiums and provisions. Information was collected from more than 5,500 benefit plans covering almost 6 million employees across the country. Get your copy of the newly released results.

Compdata Surveys, www.compdatasurveys.com, is the nation’s leading compensation and benefits survey data provider. Data is collected annually from thousands of organizations across the country. Compdata Surveys has been providing accurate, reliable data at affordable prices to organizations since 1988. For further information about the compensation and benefits surveys, contact Amy Kaminski at (800) 300-9570 or akaminski@compdatasurveys.com.

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