2015 Willis Benefits Benchmarking Survey Report

THE WILLIS BENEFITSBENCHMARKING SURVEYSURVEY REPORT | 2015

32015 Willis Benefits Benchmarking Survey

Willis conducted the 2015 Willis Benefits Benchmarking Survey from February 18, 2015 through April 3, 2015. The survey was distributed through an online tool and direct email. Responses were collected from U.S. employers of various sizes and industries and provided by individuals who participate in their organizations’ group health plan decision-making process. A total of 532 employers are represented in this survey. The largest percentage of respondents are headquartered in the South (38%), followed by the Midwest (29%), Northeast (20%) and West (13%).

Employer participants were asked to provide medical benefit plan information for all medical plans offered in 2015. Participants were asked to provide dental benefit information for their most prevalent dental plan offered (the plan with the highest enrollment).

The order of the results presented in this report may differ from the order the questions appeared in the survey. Some questions were posed to respondents only if their prior response met criteria applicable to that question; as a result, the total number of respondents will differ by question. Results have been rounded to simplify the presentation of data, which may cause some charts to not equal 100 percent.

ADDITIONAL INFORMATION For additional information or questions regarding this survey, please contact [email protected].

West: 68 employers

172 medical plans

Midwest: 156 employers

339 medical plans

South: 204 employers

434 medical plans

Northeast: 104 employers

248 medical plans

ABOUT THIS SURVEY

TABLE OF CONTENTS

Executive Summary .......................................................................................... 6

Employer Demographics ................................................................................... 7

Medical Plan Eligibility .................................................................................... 10

Medical Plan Offerings and Enrollment ............................................................ 13

Medical Plan Costs .......................................................................................... 19

PPO/POS Plans .........................................................................................................19

HMO/EPO Plans........................................................................................................21

HSA-Eligible CDHPs ...................................................................................................23

CDHPs with HRAs ......................................................................................................25

Medical Plan Design Details ............................................................................ 27

PPO/POS Plan Design Details ....................................................................................27

Deductibles ........................................................................................................................... 28

Out-of-Pocket Maximums ......................................................................................................... 29

Physician Office Visit Coverage ............................................................................................... 30

Inpatient Hospitalization ......................................................................................................... 31

Outpatient Surgery/Hospital Services ....................................................................................... 31

Emergency Room Services ...................................................................................................... 32

Urgent Care Services ............................................................................................................. 32

Prescription Drug Coverage .................................................................................................... 33

HMO/EPO Plan Design Details ..................................................................................36

Deductibles ........................................................................................................................... 37








HSA-Eligible CDHP Plan Design Details ......................................................................44

Deductibles ........................................................................................................................... 45







Employer Contribution to Health Savings Accounts...................................................................... 50


CDHP with HRA Plan Design Details ..........................................................................54

Deductibles ........................................................................................................................... 55







HRA Fund Contributions .......................................................................................................... 59


Dental Plans ................................................................................................... 62

Benefits Strategy ............................................................................................. 67

Global Benefits Strategy.................................................................................. 71

6 2015 Willis Benefits Benchmarking Survey

Willis’ inaugural Benefits Benchmarking Survey gathered information related to employer medical and dental plan design and costs, as well as benefits strategies. Within this survey, 532 employers provided responses for 1,193 medical plans, which allowed us to view benchmark data across all benefit plan offerings.

Continuing the trend evidenced in the Willis 2014 Health Care Reform Survey, employers remain committed to offering health benefits to their employees; only 2% of respondents stated they were unlikely to continue to offer health benefits over the next five years.

PPO/POS plans continue to be the most prevalent medical plan type, offered by 87% of employers. Health Savings Account eligible Consumer Driven Health Plans (HSA-eligible CDHPs) have emerged as the second most prevalent medical plan offering at 47%, a position that, in the past, had been occupied by HMO/EPO plans, which are now offered by only 22% of employers. CDHP plans with Health Reimbursement Accounts (HRA) are only offered by 12% of respondents.

When HMO/EPO plans are offered, employees are taking the opportunity to enroll in these plans; for the 22% of employers that offer HMO/EPO plans, almost half (46%) of enrolled employees chose the HMO/EPO plan over all other offerings.

Dental plans are offered by the vast majority of employers. Most employers offer one to two dental plan options, and Dental PPO plans are the most popular offering by far.

As the 2018 effective date for the Cadillac Tax draws closer, many employers are taking steps to quantify the impact of this tax on their organizations (41%). Of those employers who have projected the liability, 44% anticipate the tax will hit in 2018 (assuming no plan design changes).

Although some employers (27%) are already making changes in response to the Cadillac Tax, many (41%) are still in “wait-and-see” mode and have not made any changes. Modification of plan designs is the most common strategy to avoid/lessen the tax followed by contribution changes. Few employers are planning to terminate their health plan to avoid the tax (2%).

While PPACA was drafted on the assumption that employers would offset reduced medical benefit spending with increased cash compensation for their employees, the majority (77%) of respondents do not believe there is any expectation that savings will be shared in the form of cash compensation or otherwise.

EXECUTIVE SUMMARY

Approximately one-fifth of employers have employees that work outside the U.S. and almost half (45%) have five or more non-U.S. locations. Forty-two percent stated that they do not have a global strategy in place and do not have plans to develop one. Top global priorities are compliance (42%) and cost management (27%).


EMPLOYER DEMOGRAPHICS

PARTICIPANTS BY EMPLOYER SIZE Participation was evenly split between small1 employers (50%) and large2 employers (50%).

PARTICIPANTS BY INDUSTRY Participants were from a wide range of industries, with manufacturing accounting for one-fifth of overall participation.

1 Employers with fewer than 500 employees2 Employers with more than 500 employees

2% 2% 2% 3%

3% 3% 3%

4% 4% 5%

6% 7%

8% 9% 9%

11% 20%

0% 5% 10% 15% 20% 25%

Other Media/Entertainment/Telecom

Hospitality/Food Service Other Professional Services

Legal Services Government

Oil/Gas/Mining/Energy Automotive/Aerospace/Transportation

Business Services/Consulting Construction

Education Technology (computers, software, ISP, etc.)

Financial Services Retail/Wholesale

Nonprofit Health Services/Hospitals

Manufacturing

Percentage of Employers

50% under 500 employees

50% over 500 employees

27%

23%

18%

25%

7%

0% 5% 10% 15% 20% 25% 30%

Under 250 employees

250–499 employees

500–999 employees

1,000–4,999 employees

5,000+ employees


PARTICIPANTS BY EMPLOYER SIZEParticipation was evenly split between small1 employers (50%) and large2 employers (50%).

PARTICIPANTS BY INDUSTRYParticipants were from a wide range of industries, with manufacturing accounting for one-fifth of overall participation.

1 Employers with fewer than 500 employees 2 Employers with more than 500 employees

2% 2% 2% 3%

3% 3% 3%

4% 4% 5%

6% 7%

8% 9% 9%

11% 20%

0% 5% 10% 15% 20% 25%

Other Media/Entertainment/Telecom

Hospitality/Food Service Other Professional Services

Legal Services Government

Oil/Gas/Mining/Energy Automotive/Aerospace/Transportation

Business Services/Consulting Construction

Education Technology (computers, software, ISP, etc.)

Financial Services Retail/Wholesale

Nonprofit Health Services/Hospitals

Manufacturing


50% under 500 employees

50% over 500employees

27%

23%

18%

25%

7%

0% 5% 10% 15% 20% 25% 30%

Under 250 employees

250-499 employees

500-999 employees

1,000-4,999 employees

5,000+ employees




AVERAGE EMPLOYEE AGE BY REGION Across all employers, the average employee age was 41.7 years old. The only region reporting an average age of under 40 was the West (39.6), and the only industries to report an average age under 40 were retail/wholesale (39.2) and technology (39.5). The industry with the highest average employee age was manufacturing (43.2).

EMPLOYEE POPULATION BY GENDER Males represented a slightly larger percentage (54%) of overall employee populations.

41.7 42.0 42.141.8

39.6

38.038.539.039.540.040.541.041.542.042.5

Northeast South Midwest West

All Employers By Region

% Male 54%

% Female46%



EMPLOYERS WITH PART-TIME EMPLOYEES Eighty-six percent of respondents reported having one or more part-time employees3; the majority (61%) of employers have fewer than 100 part-time employees.

PERCENTAGE OF EMPLOYERS WITH UNION REPRESENTATION Twenty percent of employers reported having union representation within their workforce. Union representation was greater among large employers (29%) than small employers (11%). Of those employers with union membership, the average union population was 30% of the total employee population.

3 Part-time is defined as working less than 30 hours per week

61%

9%

7%

3%

5%

1%

14%

0% 10% 20% 30% 40% 50% 60% 70%

1–99 employees

100–249 employees

250–499 employees

500–999 employees

1,000–4,999 employees

5,000+ employees

No part-time employees


20%

11%

29%

0%

5%

10%

15%

20%

25%

30%

35%

All Employers Under 500 employees 500+ employees

3 Part-time is defined as working less than 30 hours per week


MEDICAL PLAN ELIGIBILITY

31%

1%

2%

0% 5% 10% 15% 20% 25% 30% 35%

Part-time employees

Seasonal employees

Interns

Percentage of Employers Offering

MEDICAL PLAN WAITING PERIOD Medical plan waiting periods (the amount of a time an employee needs to wait before becoming eligible for medical benefits) vary among employer respondents. Seventeen percent have no waiting period (employees are eligible for medical benefits on the date of hire). The most common waiting periods were first of the month following date of hire (24%) followed by first of the month following 30 days of employment (23%).

EMPLOYEE CLASSIFICATIONS ELIGIBLE FOR MEDICAL BENEFITS, OTHER THAN FULL-TIME EMPLOYEES Thirty-one percent of respondents offer medical benefits to part-time employees. Few employers reported that seasonal employees or interns were eligible for medical benefits (1% and 2% respectively). Of those employers that offer benefits to part-time employees, 97% offer the same medical plan options to both full-time and part-time employees (as opposed to offering a separate plan for part-time employees only).

17%

24%

5%

23%

6%

16%

9%

0%

0% 10% 20% 30%

No waiting period – health benefits effective as of date of hire

1st of the month following date of hire

30 days

1st of the month following 30 days of employment

60 days

1st of the month following 60 days of employment

90 days

More than 90 days


Highlight on Technology: Techemployees have shorter waitingperiods than in any other industry: 46% have no waiting period, and another 46% use the 1st of the month following date of hire.



46%

50%

44% 45% 46% 47% 48% 49% 50% 51%

A surcharge is applied for all spouses

A surcharge is applied only for those spouses who have access to medical coverage elsewhere

Prevalence of Spousal Surcharge Method

SPOUSAL SURCHARGE APPROACH Fifteen percent of employers impose a surcharge for spouses covered under the medical plan. Of those employers, 46% apply the surcharge for all spouses and 50% only apply the surcharge if the spouse has access to medical coverage elsewhere.

METHOD USED TO VERIFY AVAILABLE COVERAGE FOR SPOUSES Thirteen percent of employers require verification if spouses have medical coverage elsewhere. Of those employers, the majority (78%) require a written attestation for verification of coverage.

6%

78%

2%

0% 20% 40% 60% 80% 100%

Outside company conducts verification

Require written attestations

Outbound phone calls to employees

Prevalence of Verification Method



The median monthly spousal surcharge across all employers is $147. The table below provides median monthly spousal surcharges across various employer size groups and regions.

Median Monthly Spousal Surcharge Amount

All employers $147.00

Northeast region $147.00 South region $150.00 Midwest region $127.50 West region $150.00 Under 250 employees $228.00 250–499 employees $103.00 500–999 employees $150.00 1,000–4,999 employees $138.00 5,000+ employees $100.00

On average, 78% of medical-eligible employees enrolled in medical benefits for the 2015 plan year. Of those employees, the average percentage that elected dependent (spouse and/or children) coverage was 47%.

78%

Enrolled

47%

Dependent Election


MEDICAL PLAN OFFERINGS AND ENROLLMENT

88%

34%

43%

16%

5%

1%

88%

19%

42%

13%

2%

1%

86%

8%

60%

8%

2%

2%

82%

51%

40%

13%

1%

1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

PPO/POS

HMO/EPO

HSA-eligible CDHP

CDHP with HRA

Indemnity Plan

Limited Medical Plan


Northeast Region

South Region

Midwest Region

West Region

TYPES OF MEDICAL PLANS OFFERED Most respondents (87%) offer a PPO/POS plan. HSA-eligible CDHPs are the second most prevalent medical plans offered (47%).

TYPES OF MEDICAL PLANS OFFERED BY REGION

87%

22%

47%

12%

2%

2%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

PPO/POS

HMO/EPO

HSA-eligible CDHP

CDHP with HRA

Indemnity Plan



HMO/EPO plans are significantly more prevalent in the West region.



NUMBER OF MEDICAL PLANS OFFERED Most employers (85%) offer three medical plans or fewer. More than one-third (36%) of employers offer two medical benefit plan options.

NUMBER OF MEDICAL PLANS OFFERED BY EMPLOYER SIZE

25%

36%

24%

7%

3%

4%

0% 5% 10% 15% 20% 25% 30% 35% 40%

1

2

3

4

5

More than 5 plans


30%

25%

18%

11%

36%

40% 39%

35%

24% 21% 23%

25% 27%

32%

6% 3%

8%

13%

3% 2% 2%

5% 3%

1% 2% 2%

6%

18%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Under 250 Employees 250–499 Employees 500–999 Employees 1,000–4,999 Employees

5,000+ Employees

Perc

enta

ge o

f Em

ploy

ers

1 2 3 4 5 More than 5 plans

Only 5,000+ employersize groups typicallyoffer more than fivemedical plans.

33%

10%


Fully insured48%

Self insured47% Minimum

premium arrangement

3%

Other2%

67%

46%

33%

48%

12%

16%

0% 10% 20% 30% 40% 50% 60% 70% 80%

PPO/POS

HMO/EPO

HSA-eligible CDHP

CDHP with HRA

Indemnity Plan


Percentage of Total Enrolled Employees

AVERAGE ENROLLMENT PER PLAN TYPE WHEN OFFERED When offered, average enrollment for PPO/POS plans is 67% of total medical enrollment. While only 22% of employers offer HMOs, those that do report 46% HMO/EPO enrollment of total medical enrollment.

FUNDING METHOD Employers were asked to provide the funding method for their most prevalent medical plan (if funding methods varied by plan). Employers were almost evenly split between self-funding (47%) and fully insured (48%) plans. Three percent of employers utilize a minimum premium arrangement.



76%

58%

34%

28%

17%

38%

57%

69%

92%

5% 2% 4% 2% 3%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Under 250Employees

250–499Employees

500–999Employees

1,000–4,999Employees

5,000+ Employees


Fully insured Self insured Minimum premium arrangement

FUNDING METHOD BY EMPLOYER SIZE As employer size increases, so does the prevalence of self-funding.


4%

2%

Tobacco and non-tobacco status


The most common way to differentiate employee contributions is through completion of wellness incentives by varying contributions based on tobacco and non-

S ST

SA those employers that differentiate employee contributions by sa le the most common number of wage

levels is four (28%) or three (27%).

21%

27%28%

10%

14%

2

4

5


On average, employers reported that their average total medical and prescription drug plan costs account for 18% of total 2014 payroll. This percentage varies by industry, region and employer size.

Average Total Medical and Prescription Drug Plan Costs as a Percentage of 2014 Payroll

All employers 18%

Northeast region 18% South region 20% Midwest region 19% West region 14%

Under 250 employees 16% 250–499 employees 18% 500–999 employees 19% 1,000–4,999 employees 20% 5,000+ employees 18%

Education 18% Financial Services 18% Health Services/Hospitals 25% Manufacturing 17% Nonprofit 19% Retail/Wholesale 16% Technology 14%

Under 500 employees 17% 500+ employees 20%



$635

$1,874

$503

$1,461

$517

$1,524

$583

$1,720

$153

$575

$129

$549

$123

$433

$157

$641

24%

31%

26%

38%

24%

28%27%

37%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

Individual Family Individual Family Individual Family Individual Family

Northeast Region South Region Midwest Region West Region

Average Monthly Premium Average Monthly Employee Contribution Contribution as a % of Premium

PPO/POS PREMIUM AND CONTRIBUTIONS The average monthly premium for PPO/POS plans across all employers was $543 for individuals and $1,592 for families. Employee contributions as a percentage of premium was 25% for individuals and 33% for families.

PPO/POS PREMIUM AND CONTRIBUTIONS BY REGION From a regional perspective, while the Northeast has the highest premium dollar amounts, the West has the highest employee contributions as a percentage of premiums with 27% for individuals and 37% for family coverage.

$543

$1,592

$135

$530

25%33%

0%5%10%15%20%25%30%35%40%45%50%

$0$200$400$600$800

$1,000$1,200$1,400$1,600$1,800

Individual Family


MEDICAL PLAN COSTS


$546

$1,584

$539

$1,601

$130

$559

$139

$502

24%

35%

26%

31%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

Individual Family Individual Family

Under 500 employees 500+ employees


PPO/POS PREMIUM AND CONTRIBUTIONS BY EMPLOYER SIZE Premiums and contributions for PPO/POS plans are similar among small and large size employers.

PPO/POS RATE TIER STRUCTURE Nearly two-thirds (63%) of PPO/POS plans have a 4-tier rate structure for their premiums and contributions (Employee only, Employee + Spouse, Employee + Child(ren), Family).

7%

23%

63%

5%

2%

Two-Tier

Three-Tier

Four-Tier

Five-Tier

Other

MEDICAL PLAN COSTS


HMO/EPO PREMIUM AND CONTRIBUTIONS The average monthly premium for HMO/EPO plans across all employers was $537 for individuals and $1,565 for families. Employee contributions as a percentage of premium was 22% for individuals and 31% for families.

HMO/EPO PREMIUM AND CONTRIBUTIONS BY REGION For HMO/EPO plans, the Northeast has the highest premium and financial contribution amounts, along with the highest employee contributions as a percentage of premiums for individuals (27%). The South has the highest employee contributions as a percentage of premiums for families (34%).

$537

$1,565

$118

$492

22%

31%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

Individual Family


$569

$1,680

$528

$1,483

$501

$1,417

$531

$1,581

$156

$536

$122

$511

$104

$303

$92

$489

27%

32%

23%

34%

21% 21%

17%

31%

0%5%10%15%20%25%30%35%40%45%50%

$0$200$400$600$800

$1,000$1,200$1,400$1,600$1,800




MEDICAL PLAN COSTS


$562

$1,639

$516

$1,502

$115

$515

$120

$47220%

31%

23%

31%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800




8%

25%

61%

4%

1%

Two-Tier

Three-Tier

Four-Tier

Five-Tier

Other

HMO/EPO PREMIUM AND CONTRIBUTIONS BY EMPLOYER SIZE Premium and contribution amounts for HMO/EPO plans are slightly higher for small employers.

HMO/EPO RATE TIER STRUCTURE The majority (61%) of HMO/EPO plans have a 4-tier rate structure for their premiums and contributions.

MEDICAL PLAN COSTS


$545

$1,514

$431

$1,222

$447

$1,291

$479

$1,394

$93

$378

$82

$345

$90

$323

$97

$41417%

25%

19%

28%

20%

25%

20%

30%

0%5%10%15%20%25%30%35%40%45%50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600




HSA-ELIGIBLE CDHP PREMIUM AND CONTRIBUTIONS The average monthly premium for HSA-eligible CDHP plans across all employers was $464 for individuals and $1,323 for families. Employee contributions as a percentage of premium was 19% for individuals and 27% for families.

HSA-ELIGIBLE CDHP PREMIUM AND CONTRIBUTIONS BY REGION For HSA-eligible CDHP plans, contributions as a percentage of premium are fairly consistent across the regions, with the Northeast reporting the lowest employee contribution as a percentage of premium for individuals and the West region having the highest family contribution percentage.

$464

$1,323

$88

$351

19%27%

0%5%10%15%20%25%30%35%40%45%50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

Individual Family


MEDICAL PLAN COSTS


$493

$1,390

$440

$1,268

$92

$404

$86

$313

19%

29%

20% 25%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600




11%

20%

64%

3%

1%

Two-Tier

Three-Tier

Four-Tier

Five-Tier

Other

HSA-ELIGIBLE CDHP PREMIUM AND CONTRIBUTIONS BY EMPLOYER SIZE Premium and contribution amounts for HSA-eligible CDHPs are slightly higher for small employers.

HSA-ELIGIBLE CDHP RATE TIER STRUCTURE

MEDICAL PLAN COSTS

The majority (64%) of HSA-eligible CDHP plans have a four-tier rate structure for their premiums and contributions.


MEDICAL PLAN COSTS

$511

$1,453

$106

$416

21%29%

0%5%10%15%20%25%30%35%40%45%50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

Individual Family


$518

$1,447

$508

$1,456

$101

$500

$108

$37920%

35%

21% 26%

0%5%10%15%20%25%30%35%40%45%50%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600




HRA PLAN PREMIUM AND CONTRIBUTIONS The average monthly premium for HRA plans across all employers was $511 for individuals and $1,453 for families. Employee contributions as a percentage of premium was 21% for individuals and 29% for families.

HRA PLAN PREMIUM AND CONTRIBUTIONS BY EMPLOYER SIZE Family coverage contributions as a percentage of premium is 9% higher for small employers.

26

10%

18%

67%

4%

1%

Two-Tier

Three-Tier

-Tier

-Tier

H The majority (67%) of HRA plans have a four-tier rate structure for their premiums and contributions.


PPO/POS PLAN DESIGN DETAILS

PPO/POS PLAN DESIGN DETAILS PPO/POS plans remain the most prevalent medical plan type offering: 466 employers provided information for 673 PPO/POS plans.

Average PPO/POS Plan Design Median Amounts

All Employers Deductibles Individual in-network deductible $750 Family in-network deductible $2,000 Individual out-of-network deductible $1,500 Family out-of-network deductible $4,000 Out-of-Pocket Maximums Individual in-network out-of-pocket maximum $3,000 Family in-network out-of-pocket maximum $6,000 Individual out-of-network out-of-pocket maximum $6,000 Family out-of-network out-of-pocket maximum $12,000 Plan Coinsurance In-network 80% Out-of-network 60% Office Visit Coverage Physician office visit copay $25 Specialist office visit copay $40 Inpatient Hospitalization Coverage Median in-network coinsurance* 80% Median in-network copay* $250 Outpatient Surgery Median in-network coinsurance* 80% Median in-network copay* $150 Emergency Room Coverage Median in-network coinsurance* 80% Median in-network copay* $150 Urgent Care Coverage Median in-network coinsurance* 80% Median in-network copay* $40 Prescription Drug Retail/Mail Order Median generic copay $10/$20 Median preferred brand copay $30/$60 Median non-preferred brand copay $50/$120

*Where applicable



DEDUCTIBLES BY EMPLOYER SIZE Deductibles for PPO/POS plans are typically lower for larger employers compared to smaller employers.

DEDUCTIBLES BY REGION The South region reported the highest deductibles both in- and out-of-network for PPO/POS plans, with amounts twice as high as those being reported for the West region.

$925

$2,000

$1,000

$2,000

$750

$2,000

$500

$1,000

$1,500

$3,000

$2,000

$4,250

$2,000

$4,000

$1,000

$2,000

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500



Median Deductible: In-Network Median Deductible: Out-of-Network

$750

$2,000

$1,000

$2,250

$750

$1,500$1,500

$4,000

$2,000

$4,000

$1,500

$3,000

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

Individual Family Individual Family Individual Family





OUT-OF-POCKET MAXIMUMS BY EMPLOYER SIZE On average, out-of-pocket maximums for PPO/POS plans are the same among small and large employers.

OUT-OF-POCKET MAXIMUMS BY REGION The South region cited the highest out-of-pocket maximums while the Northeast had the lowest.

$2,600

$5,550

$3,500

$7,750

$3,000

$6,000

$2,500

$6,000$5,000

$10,000

$6,000

$13,200

$6,000

$12,000

$6,000

$12,875

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000



Median Out-of-Pocket Maximum: In-Network Median Out-of-Pocket Maximum: Out-of-Network

$3,000

$6,000

$3,000

$6,000

$3,000

$6,000$6,000

$12,000

$6,000

$12,000

$6,000

$12,000

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000




30

oss p o visit is s visit isso th sp visit

80%

19%

1%

Median Office Visit Copay Median Specialist Visit Copay



68%

9%

4%

2%

9%

2%

4%

1%

71%

8%

10%

4%

3%

0%

1%

4%

0% 20% 40% 60% 80%

Coinsurance applies at the same level as the overall plan coinsurance

The plan charges a dollar amount per stay and coinsurance applies at the same level as the overall plan coinsurance

Coinsurance applies at a different level than the overall plan coinsurance

The plan charges a dollar amount per stay and coinsurance applies at a different level as the overall plan coinsurance

The plan charges a dollar amount per stay

The plan charges a dollar amount per stay up to a maximum number of days

There is no employee cost-sharing for this coverage

Not covered

Percentage of Plans

In-Network

Out-of-Network

71%

5%

3%

1%

11%

6%

1%

75%

5%

10%

3%

2%

1%

4%

0% 20% 40% 60% 80%


The plan charges a dollar amount per visit and coinsurance applies at the same level as the overall plan coinsurance


The plan charges a dollar amount per visit


Not covered

Percentage of Plans

In-Network

Out-of-Network

INPATIENT HOSPITALIZATION Most PPO/POS plans apply coinsurance for inpatient hospitalization coverage at the same level as the overall plan coinsurance for both in-network (68%) and out-of-network (71%). When copays are required, the median in-network amount is $250.

OUTPATIENT SURGERY/HOSPITAL SERVICES The majority of PPO/POS plans apply coinsurance for outpatient surgery/hospital services at the same level as the overall plan coinsurance, both in-network (71%) and out-of-network (75%). When copays are required, the median in-network amount is $150.

The plan charges a dollar amount per visit and coinsurance applies at a different level as the overall plan coinsurance



60%

34%

4%

2%

1%

22%

60%

13%

1%

4%

0% 20% 40% 60% 80%





Not covered

Percentage of Plans

In-Network

Out-of-Network

EMERGENCY ROOM SERVICES: IN-NETWORK More than half (54%) of PPO/POS plans charge a dollar amount per visit for emergency room services. The median copay is $150 across all employers.

URGENT CARE SERVICES Sixty percent of PPO/POS plans charge a dollar amount for in-network urgent care services with a median copay of $40. For out-of-network coverage, 60% of plans apply coinsurance at the same level as the overall plan coinsurance.

54%

40%

4%

1%

1%

0% 10% 20% 30% 40% 50% 60%





Not covered

Percentage of Plans

33

7%

70%

21%

2%

r

t s h th p d pl



PRESCRIPTION DRUG COVERAGE When looking at the breakdown of prescription drug coverage, 82% require copays with only 3% utilizing a minimum/maximum copayment structure.

PRESCRIPTION DRUG COPAYS Where copays are required (in any combination), the median copays for 3-tier plans are as follows:

82%

8%

4%

3%

4%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Copays required

Coinsurance required

Combination of coinsurance and copays required

Minimum and maximum copays required

Combination of coinsurance and min/max copays required

Percentage of Plans

$10

$30

$50

$20

$60

$120

$0

$20

$40

$60

$80

$100

$120

$140

Generic Preferred Brand Non-Preferred Brand

Median Retail Copay Median Mail Order Copay



PRESCRIPTION DRUG PLAN DEDUCTIBLES Twelve percent of all PPO/POS plans have a separate prescription drug deductible from the overall medical plan deductible. When in place, the median individual deductible is $100 and the median family deductible is $200.

$100

$200

$0

$50

$100

$150

$200

$250

Median Individual Deductible Median Family Deductible


HMO/EPO PLAN DESIGN DETAILS

HMO/EPO PLAN DESIGN DETAILS Within this survey, 114 employers submitted information for 153 HMO/EPO plans.

Average HMO/EPO Plan Design Median Amounts

All Employers Deductibles

Individual in-network deductible* $750

Family in-network deductible* $2,000

Out-of-Pocket Maximums

Individual in-network out-of-pocket maximum $2,000

Family in-network out-of-pocket maximum $4,000

Plan Coinsurance In-network 100%

Office Visit Coverage

Physician office visit copay $20

Specialist office visit copay $30

Inpatient Hospitalization Coverage

Median in-network coinsurance* 80%

Median in-network copay* $250

Outpatient Surgery Median in-network coinsurance* 85%


Emergency Room Coverage

Median in-network coinsurance* 80%


Urgent Care Coverage Median in-network coinsurance* 90% Median in-network copay* $30

Prescription Drug Retail/Mail Order Median generic copay $10/$20 Median preferred brand copay $30/$80 Median non-preferred brand copay $50/$100

*Where applicable



DEDUCTIBLES BY EMPLOYER SIZE Forty-two percent of HMO/EPO plans require deductibles. The median deductible across all employers is $750 for individual coverage and $2,000 for family coverage. Deductibles tend to be higher among smaller employers.

DEDUCTIBLES BY REGION HMO/EPO plans in the South and Midwest regions have the lowest deductibles.

$750

$2,000

$1,000

$2,000

$500

$1,200

$0

$500

$1,000

$1,500

$2,000

$2,500



Median Deductible: In-Network

$1,000

$2,000

$500

$1,000

$500

$1,000

$625

$1,750

$0

$500

$1,000

$1,500

$2,000

$2,500



Median Deductible: In-Network



OUT-OF-POCKET MAXIMUMS BY EMPLOYER SIZE HMO/EPO out-of-pocket maximums are similar among small and large employers.

OUT-OF-POCKET MAXIMUMS BY REGION HMO/EPO plans in the West and Midwest regions have the lowest out-of-pocket maximums.

$3,000

$6,000

$3,000

$6,000

$1,500

$3,000

$1,500

$3,000

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000



Median Out-of-Pocket Maximum: In-Network

$2,000

$4,000

$2,000

$4,000

$2,200

$4,400

$0$500

$1,000$1,500$2,000$2,500$3,000$3,500$4,000$4,500$5,000



Median Out-of-Pocket Maximum: In-Network



PHYSICIAN OFFICE VISIT COVERAGE

OFFICE VISIT COPAYAcross all employers, the median physician office visit copay is $20, and the median specialist visit is $30. The West region has the lowest copays for both physician and specialist office visits.

95%

3%2%

Physician visit copay required (% of plans)

Coinsurance and deductibles apply for alloffice visits

Office visits are covered by the plan (thereis no employee cost-sharing for thiscoverage)

$20

$25

$20 $20

$40

$35

$25

$20

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50



PHYSICIAN OFFICE VISIT COVERAGE

OFFICE VISIT COPAYS BY REGIONAcross all employers, the median physician office visit copay is $20, and the median specialist visit is $30. The Westregion has the lowest copays for both physician and specialist office visits.

[VALUE]

3% 2%

Physician Visit Copay Required (% of plans)

Coinsurance and deductibles apply for all office visits

Office visits are covered by the plan (there is no employee cost-sharing for this coverage)

$20 $20

$25

$20 20

$30

$40

$35

$25

$20

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

All Employers Northeast Region South Region Midwest Region West Region


The majority of HMO/EPO plans (95%) require a copay for physician office visits.



23%

9%

3%

1%

46%

4%

14%

0%

0% 10% 20% 30% 40% 50%


T he plan charges a dollar amount per stay and coinsurance applies at the same level as the overall plan coinsurance






Not covered

Percentage of Plans

INPATIENT HOSPITALIZATION: IN-NETWORK Nearly half (46%) of HMO/EPO plans charge a dollar amount per stay only for inpatient hospitalization, and an additional 9% charge a copay along with coinsurance. Four percent charge a dollar amount per stay up to a maximum number of days. The median copay amount is $250.

OUTPATIENT SURGERY/HOSPITAL SERVICES: IN-NETWORK Outpatient surgery/hospital services for HMO/EPO plans are covered similarly to inpatient hospitalization with the majority charging a dollar amount per stay. The median copay amount is $100.

27%

6%

3%

1%

47%

15%

0%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%






Not covered

Percentage of Plans




EMERGENCY ROOM SERVICES: IN-NETWORK The majority of HMO/EPO plans (78%) charge a dollar amount per visit for emergency room services; the median copay is $100.

URGENT CARE SERVICES: IN-NETWORK The majority of HMO/EPO plans (86%) charge a dollar amount per visit for urgent care services; the median copay is $30.

86%

9%

1%

3%

1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%





Not covered

Percentage of Plans

78%

2%

18%

3%

0%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%





Not covered

Percentage of Plans



PRESCRIPTION DRUG PLAN – TIER STRUCTURE The majority (63%) of HMO/EPO plans have a three-tier structure, though nearly a quarter (24%) have a two tier structure with just generic and brand coverage.

PRESCRIPTION DRUG COVERAGE The vast majority (93%) require copays only for prescription drug coverage.

24%

63%

11%

2%

Two-tier (Generic/Brand coverage)

Three-tier (Generic/Preferred Brand/Non-Preferred Brand)

Four-tier (Generic/Preferred Brand/Non-Preferred Brand/Specialty)

Five-tier (Generic/Non-Preferred Generic/Preferred Brand, Non-Preferred Brand/Specialty)

93%

4%

2%

1%

2%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Copays required

Coinsurance required

Combination of coinsurance and copays required

Minimum and maximum copays required

Combination of coinsurance and min/max copays required

Percentage of Plans



PRESCRIPTION DRUG COPAYS When copays are required (in any combination), the median copays are as follows:

$10

$30

$50

$20

$80

$100

$0

$20

$40

$60

$80

$100

$120




HSA-ELIGIBLE CDHP PLAN DESIGN DETAILS

HSA-ELIGIBLE CDHP PLAN DESIGN DETAILS HSA-eligible CDHPs are the most prevalent plan type offering after PPO/POS plans. Within this survey, 245 employers submitted information for 294 HSA-eligible plans.

Average HSA-Eligible CDHP Plan Design Median Amounts – All Employers Deductibles Individual in-network deductible $2,100 Family in-network deductible $4,500 Individual out-of-network deductible $4,000 Family out-of-network deductible $8,000 Out-of-Pocket Maximums Individual in-network out-of-pocket maximum $3,900 Family in-network out-of-pocket maximum $8,000 Individual out-of-network out-of-pocket maximum $8,000 Family out-of-network out-of-pocket maximum $16,000 Plan Coinsurance In-network 90% Out-of-network 60% Inpatient Hospitalization Coverage Median in-network coinsurance* 90% Outpatient Surgery Median in-network coinsurance* 90% Emergency Room Coverage Median in-network coinsurance* 90% Urgent Care Coverage Median in-network coinsurance* 90% Prescription Drug Copays After Deductible Retail/Mail Order Median generic copay $10/$24 Median preferred brand copay $30/$60 Median non-preferred brand copay $50/$110 HSA Fund – Employer Contribution* Individual $600 Family $1,000

*Where applicable



DEDUCTIBLES BY EMPLOYER SIZE Deductibles are slightly lower for HSA-eligible CDHPs for larger employers compared to smaller employers.

DEDUCTIBLES BY REGION The Midwest region reported the highest deductibles both in- and out-of-network for HSA-eligible CDHPs.

$1,500

$3,000

$2,500

$5,000

$2,600

$5,200

$1,750

$3,650$3,000

$6,000

$4,000

$8,000

$5,000

$9,000

$3,250

$6,800

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000




$2,100

$4,500

$2,500

$5,000

$2,000

$4,000$4,000

$8,000

$5,000

$9,900

$4,000

$8,000

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000






OUT-OF-POCKET MAXIMUMS BY EMPLOYER SIZE HSA-eligible CDHP out-of-pocket maximums are similar among small and large employers.

OUT-OF-POCKET MAXIMUMS BY REGION The South region cited the highest out-of-network maximums while the West had the lowest in-network amounts.

$3,500

$7,000

$4,000

$8,000

$4,000

$8,000

$3,000

$6,000$6,350

$12,700

$9,000

$18,000

$8,000

$16,000

$7,000

$14,000

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

$20,000




$3,900

$8,000

$3,500

$7,000

$4,000

$8,000$8,000

$16,000

$8,000

$16,000

$8,000

$16,000

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000




The majority of H -eli plans ( %) require a and d for physician office visits.

4%

93%

2%


office visits



88%

2%

2%

1%

2%

0%

5%

1%

84%

2%

7%

0%

1%

0%

3%

2%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


The plan charges a dollar amount per stay and coinsurance applies at the same level as the overall plan coinsurance




Th e plan charges a dollar amount per stay up to a maximum number of days


Not covered

Percentage of Plans

In-Network

Out-of-Network

INPATIENT HOSPITALIZATION Most HSA-eligible CDHPs plans apply coinsurance for inpatient hospitalization coverage at the same level as the overall plan coinsurance, both in-network (88%) and out-of-network (84%).

OUTPATIENT SURGERY/HOSPITAL SERVICES The majority of HSA-eligible CDHP plans apply coinsurance for outpatient surgery/hospital services at the same level as the overall plan coinsurance, both in-network (88%) and out-of-network (86%).

88%

2%

1%

1%

2%

4%

1%

86%

2%

5%

1%

1%

2%

2%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%







Percentage of Plans

In-Network

Out-of-Network

Highlight on Education:14% of education industry HSA plans have no cost-sharing for in- or out-of-network inpatient hospitalization.

Not covered



6%

84%

5%

4%

1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%




Not covered

Percentage of Plans

EMERGENCY ROOM SERVICES: IN-NETWORK The majority (84%) of HSA-eligible CDHPs apply coinsurance for emergency room services at the same level as the overall plan coinsurance.

URGENT CARE SERVICES Most HSA-eligible CDHP plans apply coinsurance for urgent care services at the same level as the overall plan coinsurance, both in-network (90%) and out-of-network (85%).

2%

90%

2%

4%

1%

1%

85%

9%

2%

3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%





Not covered

Percentage of Plans

In-Network

Out-of-Network




HEALTH SAVINGS ACCOUNT ESTABLISHMENT Just over two-thirds of employers make contributions to employees’ Health Savings Accounts.

HEALTH SAVINGS ACCOUNT ESTABLISHMENT BY REGION More employers in the West region make contributions to employees’ Health Savings Accounts than any other region.

60% 59%

73%82%

58%64%

71%

82%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Employer establishes Health Savings Account on behalf of the employee

Employer makes contribution to Health Savings Account

67% 68%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Employer establishes Health Savings Account on behalf of the employee

Employer makes contribution to Health Savings Account



HSA EMPLOYER CONTRIBUTION BY EMPLOYER SIZE The median contribution to health savings accounts by employers is $600 for individuals and $1,000 for family coverage. Smaller employers make slightly higher account contributions than large employers.

$600$720

$500

$1,000

$1,200

$1,000

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400


Median Health Savings Account Employer Contribution - Individual

Median Health Savings Account Employer Contribution - Family

$600$500 $510

$750

$1,000 $1,000 $1,000

$1,450

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600


HSA EMPLOYER CONTRIBUTION BY REGION

Median Health Savings Account Employer Contribution - Individual

Median Health Savings Account Employer Contribution - Family

The West region reported the highest employer contribution amounts.

52

st SA-eligible %) have a three-tier prescription drug plan.

arly half (4 of prescription drug plans for -eligible e coinsurance only after the deductible while

ire copays only the remaining r a combination of c a minimum and maximum copays.

5%

2%

5% of coinsurance an copays

Percentage of Plans

14%

63%

22%

1%

Two-tier coverage)

Three-tier ferred rand)

Four-)

Five-tier ( n



PRESCRIPTION DRUG COPAYS When copays are required (in any combination), the median copays for three-tier plans are as follows:

$10

$30

$50

$24

$60

$110

$0

$20

$40

$60

$80

$100

$120




CDHP with HRA PLAN DESIGN DETAILS

CDHP WITH HRA PLAN DESIGN DETAILS CHDPs with HRAs are the least commonly offered plan type. Within this survey, 63 employers submitted information for 73 CDHP with HRA plans.

Average CHDP with HRA Plan Design Median Amounts – All

Employers Deductibles Individual in-network deductible $1,500 Family in-network deductible $3,600 Individual out-of-network deductible $3,375 Family out-of-network deductible $6,750 Out-of-Pocket Maximums Individual in-network out-of-pocket maximum $3,975 Family in-network out-of-pocket maximum $7,950 Individual out-of-network out-of-pocket maximum $7,125 Family out-of-network out-of-pocket maximum $14,750 Plan Coinsurance In-network 80% Out-of-network 60% Inpatient Hospitalization Coverage Median in-network coinsurance* 80% Outpatient Surgery Median in-network coinsurance* 80% Emergency Room Coverage Median in-network coinsurance* 80% Median in-network copay* $125 Urgent Care Coverage Median in-network coinsurance* 80% Prescription drug copays after deductible Retail/Mail Order Median generic copay $10/$20 Median preferred brand copay $30/$61 Median non-preferred brand copay $58/$119 HRA Fund – Employer Contribution Individual $500 Family $1,100

*Where applicable



DEDUCTIBLES BY EMPLOYER SIZE HRA deductibles are considerably lower for larger employers compared to smaller employers.

OUT-OF-POCKET MAXIMUMS BY EMPLOYER SIZE HRA plan out-of-pocket maximums are lower for larger employers compared to smaller employers.

$1,500

$3,600$2,500

$5,000

$1,500

$3,000$3,375

$6,750

$5,000

$11,000

$3,000

$6,000

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000




$3,975

$7,950

$4,000

$8,000

$3,750

$7,900$7,125

$14,750

$8,000

$16,000

$7,000

$14,000

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000






PHYSICIAN OFFICE VISIT COVERAGE The majority of CDHPs with HRAs (81%) apply coinsurance and deductibles for all office visits.

19%

81%


Coinsurance and deductibles apply for all office visits



INPATIENT HOSPITALIZATION Most HRA plans apply coinsurance for inpatient hospitalization coverage at the same level as the overall plan coinsurance, both in-network (89%) and out-of-network (86%).

OUTPATIENT SURGERY/HOSPITAL SERVICES The majority of CDHPs with HRAs apply coinsurance for outpatient surgery/hospital services at the same level as the overall plan coinsurance, both in-network (88%) and out-of-network (89%).

89%

1%

3%

1%

1%

0%

4%

0%

86%

3%

6%

1%

1%

0%

0%

3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


T he plan charges a dollar amount per stay and coinsurance applies at the same level as the overall plan coinsurance


T he plan charges a dollar amount per stay and coinsurance applies at a different level as the overall plan coinsurance




Not covered

Percentage of Plans

In-Network

Out-of-Network

88%

1%

4%

1%

1%

4%

0%

89%

1%

3%

3%

1%

0%

3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%







Not covered

Percentage of Plans

In-Network

Out-of-Network

with

arly three quarters (72%) of with HRAs apply coinsurance for emergency room services at the same level as the

overall plan coinsurance.

with HRAs apply coinsurance for urgent care services at the same level as overall coinsurance, both in-network

(82%) and out-of-network (83%).

13%

82%

3%

3%

6%

83%

8%

3%


applies at the same level as the overall plan coinsurance

applies at a different level than the overall plan coinsurance


covered

Percentage of Plans

18%

72%

6%


applies at the same level as the overall plan coinsurance

applies at a different level than the overall plan coinsurance


covered

Percentage of Plans



HRA EMPLOYER CONTRIBUTION BY EMPLOYER SIZE The median contribution to health reimbursement accounts by employers is $500 for individuals and $1,100 for family coverage. Smaller employers have slightly higher account contributions than larger employers.

$500

$750

$500

$1,100

$1,250

$1,100

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400


Median HRA Fund Employer Contribution — Individual

Median HRA Fund Employer Contribution — Family

with

T t with HRAs (61%) have a three-tier prescription drug plan.

The majority of prescription drug plans for HRA plans require copays, with 73% requiring copays only, 13% requiring coinsurance only, and 1 requiring some combination of coinsurance, copays a minimum and ma

6%

61%

30%

3%

Two-tier coverage)

Three-tier

r )

(

73%

13%

2%

7% of coinsurance and

copays required

Percentage of Plans



PRESCRIPTION DRUG COPAYS Where copays are required (in any combination), the median copays for three-tier plans are as follows:

$10

$30

$58

$20

$61

$119

$0

$20

$40

$60

$80

$100

$120

$140




DENTAL PLANS

PREMIUMS AND CONTRIBUTIONS The average monthly premium for dental plans across all employers was $39.36 for individuals and $110.87 for families. Ninety-one percent of employers require employees to contribute to the costs of dental coverage; of these employers, 21% require employees to cover the full cost of dental coverage. Employee contributions as a percentage of premium was 60% for individuals and 58% for families

PREMIUMS AND CONTRIBUTIONS BY EMPLOYER SIZE Smaller employers have higher premiums than larger employers, and employee contributions, both from a dollar amount standpoint and percentage of premium, are higher than larger employers.

$39.36

$110.87

$23.48

$64.73

60%

58%

50%

55%

60%

65%

70%

75%

$0

$20

$40

$60

$80

$100

$120

Individual Family


$46.67

$122.07

$32.38

$100.17

$30.27

$73.98

$17.61

$56.52

65%61%

54% 56%

0%10%20%30%40%50%60%70%80%90%100%

$0

$20

$40

$60

$80

$100

$120

$140





DENTAL PLANS

DENTAL PLAN RATE TIER STRUCTURE More than half (53%) of employers have a four-tier structure for their dental plan, followed by 28% with three tier structure plans.

16%

28%53%

2% 1%

Two-Tier

Three-Tier

Four-Tier

Five-Tier

Other


DENTAL PLANS

NUMBER OF DENTAL PLANS OFFERED TO ACTIVE EMPLOYEES Ninety-nine percent of all employers offer group dental benefits. Most (63%) offer one dental plan option.

NUMBER OF DENTAL PLANS OFFERED BY EMPLOYER SIZE Larger employers are more likely to offer multiple benefit plan options than smaller employers.

63%

32%

3%

0% 10% 20% 30% 40% 50% 60% 70%

1 plan

2 plans

3 plans


72%

54%

25%

40%

0%

10%

20%

30%

40%

50%

60%

70%

80%


1 plan 2 plans 3 plans

2% 5%



DENTAL PLANS

MOST PREVALENT DENTAL PLAN (PLAN WITH THE HIGHEST ENROLLMENT) The vast majority (90%) of employers who offer group dental coverage report that their most prevalent plan is a Dental PPO plan.

Average Dental Plan Design Median Amounts – All Employers In-network Out-of-network

Preventive services — coinsurance 100% 100% Basic restorative services — coinsurance 80% 80% Major restorative services — coinsurance 50% 50% Annual median maximum benefit* $1,500 Orthodontia annual maximum benefit* $1,500

*When applicable

90%

3%

5%

2%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Dental PPO (Preferred Provider Organization)

Dental HMO (Health Maintenance Organization)

Dental Fee for Service plan (also known as Indemnity Plan or Traditional Plan)

Other


28%

52%

20%

Most dental not preventive services

percent of dental plans include orthodontic covera e. More than half of employers (5 %) provide this

for children (under 9) only.

0%

50%

90%

Preventive services Major restorative services

Percentage of Plans


BENEFITS STRATEGY

42%

24%

22%

15%

6%

3%

2%

1%

1%

34%

7%

35%

19%

7%

3%

6%

4%

17%

0% 10% 20% 30% 40% 50%

Introduce new wellness, preventive health programs

Introduce minimum essential coverage plans

Increase employee cost-sharing

Introduce HDHPs/CDHPs

Narrow network of hospitals/physicians

Eliminate spousal coverage

Referenced-based pricing approach

Encourage employee use of public exchanges

Shift from fully-insured to self-insured plans


Currently in place

Planned for 2016

BENEFIT STRATEGIES When asked what benefit strategies employers currently maintain or plan for 2016 implementation, 42% responded that they already have wellness/preventive health programs in place. Thirty-five percent of employers responded that they plan to increase employee cost-sharing for 2016.


BENEFITS STRATEGY

44%

5%12%

8% 6% 3% 5%

17%

0%5%

10%15%20%25%30%35%40%45%50%

2018 2019 2020 2021 2022 2023 2024 2025 or later


ASSUMING NO PLAN DESIGN CHANGES, YEAR THE CADILLAC TAX IS PROJECTED TO BE INCURRED Only forty-one percent of respondents have projected the potential liability of the 40% excise tax (the so-called “Cadillac” Tax) for their organization.

Assuming no plan design changes, 44% of employers project that the Cadillac tax will impact their plan in the first year the tax is effective, 2018.

REACTIONS TO CADILLAC TAX Even as the effective date of the Cadillac Tax draws closer, many employers are still in a ”wait and see” mode, with 41% waiting to make any changes in the future. Thirty percent are not concerned about the tax.

6%

21%

41%

30%

2%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Changes are currently being made

Changes are currently being made and expect tomake additional changes in the future

Waiting to make changes in the future

Not concerned about the tax

If the tax is too high, will terminate the plan to avoid the tax



BENEFITS STRATEGY

PLANNED CHANGES AS A RESULT OF THE EXCISE (CADILLAC) TAX Of the employers who are planning to make changes to their plans to avoid the tax, most are planning to make plan design changes (89%), followed by changes to employee contributions (73%). Making any adjustments to compensation is only being considered by 6% of employers.

89%

73%

37%

24%

6%

4%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Plan design changes

Contribution changes

Dropping high premium/adding high deductible plan option(s)

Remixing of rates (i.e. lower Individual rates and raise family rates to buy time before triggering tax)

Compensation changes

Dropping health insurance altogether

Percentage of Total Employers Planning to Make Changes


BENEFITS STRATEGY

PLANS TO OFFSET REDUCED MEDICAL BENEFITS BY ADDITIONAL CASH COMPENSATION While PPACA was drafted assuming employers would offset reduced spending on medical benefits because of the excise tax with increased levels of cash compensation, few employers (1%) are planning on making employees "whole" financially for the reduced expenditures on medical benefits. The majority (77%) of respondents stated that there is no expectation that any savings from reduced medical benefits in response to the Cadillac Tax will be shared in the form of cash compensation.

LIKELIHOOD OF CONTINUATION OF HEALTH BENEFIT OFFERINGS OVER THE NEXT 5 YEARS Even in the face of rising costs and regulatory actions, employers remain committed to providing health benefits, with 85% stating that they are very likely to continue offer health benefits over the next five years.

1%

11%

11%

77%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Make employees “whole” financially for the reduced expenditures on medical benefits

Share savings on medical benefits with employees but make them less than "whole" financially

No direct offset but expect that additional nontaxable benefits will be offered to offset the reduced medical

plan expenditures

There is no expectation that savings will be shared in the form of cash compensation or otherwise


85%

6%7%

1% 1%

Very LikelySomewhat LikelyLikelySomewhat UnlikelyVery Unlikely


GLOBAL BENEFITS STRATEGY

EMPLOYEE POPULATION LOCATED AND WORKING OUTSIDE OF THE UNITED STATES Twenty-one percent of participants responded that they have employees working outside of the U.S.

NUMBER OF COUNTRIES OUTSIDE OF THE U.S. WHERE EMPLOYEES ARE LOCATED Almost half (45%) of the employers with employees working outside of the U.S. have five or more non-U.S. locations.

17%

2%

2%

0% 2% 4% 6% 8% 10% 12% 14% 16% 18%

25% or less of employees are located and working outside of the U.S.

26% to 50% of employees are located and working outside of the U.S.

More than 50% of employees are located and working outside of the U.S.


One23%

Two12%

Three11%Four

9%

Five or more45%


42%

27%

18%

4%

2%

2%

2%

2%

0% 10% 20% 30% 40% 50%

Compliance

Cost management

Global benefits strategy

Wellness and well-being

Governance

Accommodating mobility (travel, short term, long term assignments)

Access to reliable information and benchmarking

Utilizing technology


GLOBAL BENEFITS STRATEGY Only 20% of employers with operations outside of the U.S. currently have a global benefits strategy in place. Forty-two percent of employers stated that they don’t have a global benefits strategy in place currently and have no plans to develop one.

TOP GLOBAL PRIORITIES When asked to rank their top global priorities, compliance was the top priority for 42% of employers, followed by cost management (27%).

20%

11%

27%

42%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Currently in place

In the process of developing one

Planning to have one in the future

None in place and do not currently have plans to develop one


BENEFITS STRATEGY

2015 Willis Benefits Benchmarking Survey Report

Healthcare

Transcript of 2015 Willis Benefits Benchmarking Survey Report