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Company Health Insurance Premiums Spike

By Ed Stone
September 1, 2016
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The 2016 Benefits Strategy & Benchmarking Survey, a survey by Arthur J. Gallagher & Co., an international insurance brokerage and risk management services firm, found that 54% of employers surveyed paid at least 5% more for health insurance premiums in 2016—with nearly one in four firms experiencing double-digit increases. The survey revealed escalating pressure on employers to maintain a competitive cost structure.

 

The survey reached more than 3,000 U.S. employers. Two-thirds (67%) of surveyed companies said that medical and pharmacy benefits are the foundation of their employee benefits package—and so they’re a vital component for hiring and retaining talented employees in a constricting labor market.

 

“Healthcare is the primary focus of cost-control efforts because it’s the majority of an employer’s benefits spend,” said James W. Durkin, Jr., president of Gallagher Benefit Services, Inc. “Employers should be deliberate about the changes they make to preserve the benefits most coveted by existing employees. Becoming a destination employer requires an open mindset about new and emerging options for curtailing healthcare costs. This approach enables companies to redeploy those funds into other employee-centric benefits that are a differentiator in the ongoing war for talent.”

 

Download the report’s executive summary at http://bit.ly/2bP8JS0.

 

Ed Stone is the senior finance editor at IMA. You can reach him at estone@imanet.org.
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