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Health Plan Cost Increases Are Returning to Pre-Pandemic Levels

Health Plan Cost Increases Are Returning to Pre-Pandemic Levels

Employers throughout the U.S. expect their group health plan premiums to increase, on average, a bit above or below 5 percent in 2022, even after taking cost-management initiatives into account, according to recent employer surveys. Overall costs for health claims are also expected to rise, health insurers forecast.Higher PremiumsHR consultancy Willis Towers Watson’s 2021 Best Practices in Health Care Survey, based on responses from 378 U.S. employers during June and July 2021, projects a 5.2 percent premium increase in health plans next year—sharply higher than the 2.1 percent increase that occurred in 2020 and larger than 2019’s 4 percent increase.Last year’s premium uptick was the smallest in decades and is seen as an anomaly, as many people deferred nonemergency care and embraced telemedicine during the pandemic, Willis Towers Watson reported. In related findings: The total average employer cost, including premiums, rose this year to an estimated $13,360 per employee, up from $12,501 in 2020. Employee contributions for premiums increased slightly to $3,331 in 2021, up from $3,269 in 2020.HR consultancy Mercer’s Survey of Employer-Sponsored Health Plans 2021 pegs the premium increase figure at 4.7 percent for 2022, based on 1,502 employer responses since mid-June.Employers are not expected to increase employees’ share of the cost of coverage in 2022, Mercer said. On average, employees will pick up 22 percent of total health plan premium costs, unchanged from 2021.”Employers understand that health care affordability is a real issue for many employees, especially for lower-wage workers,” said Tracy Watts, Mercer’s national leader for health care policy. “They are looking at a range of strategies that will keep more money in employees’ paychecks and remove cost barriers when care is needed.” Health Benefit per Employee Cost, Inflation and Workers’ EarningMercer compared its survey findings with compensation and consumer price index (CPI) data from the U.S. Bureau of Labor Statistics. (Click on graphic to view in a separate window.)† projected 2022 health cost.Mercer’s National Survey of Employer-Sponsored Health Plans 2021. Cost-Saving MeasuresAccording to Julie Stone, managing director of health and benefits at Willis Towers Watson, “rising costs and increased utilization, fueled by a resurgence in deferred care, are driving employers to find new ways to control costs while providing employees with affordable, high-quality care.”Employers responding to the Willis Towers Watson survey identified measures they are taking to address affordability in the following areas: Telebehavioral health. A majority of employers (89 percent) are offering coverage for telebehavioral mental health services, such as counseling for alcohol or drug abuse, and 7 percent are planning to offer them or are considering doing so. Onsite health promotions. More than half of employers (55 percent) offer onsite/worksite health- and wellness-promoting activities, and 17 percent are planning to offer them or are considering doing so. Specialty drugs. Over half of employers (54 percent) evaluate specialty drug costs and health outcomes through their medical plan, and another 29 percent are planning to evaluate them or are considering doing so. Centers of excellence. Nearly half of employers (48 percent) use centers of excellence within their health plans, …

New Rule Initiates Health Care Surprise Billing Arbitration

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New Rule Initiates Health Care Surprise Billing Arbitration

A new interim final rule issued by the federal government explains how an independent dispute resolution (IDR) process for patients and health care providers will work to resolve disputes over unscheduled “surprise” out-of-network health care charges.The rule, to be published in the Federal Register on Oct. 7, implements provisions of the No Surprises Act (NSA), signed into law at the end of last year. Issued by the U.S. Departments of Health and Human Services (HHS), Labor and the Treasury, along with the Office of Personnel Management (OPM), it is a follow-up to an initial final interim rule issued in July, which detailed a ban on high out-of-network cost-sharing for many emergency and nonemergency services when a patient has not consented to the charges beforehand.”Price transparency is a reality in almost every aspect of our lives except health care,” said Centers for Medicare & Medicaid Services Administrator Chiquita Brooks-LaSure. These regulations, she said, will help to ensure that health care providers and facilities “provide uninsured patients with clear, understandable estimates of the charges they can expect for their scheduled health care services.”The new rule, which requests comments, was accompanied by two fact sheets, fee guidance for 2022 and accompanying materials. The agencies also launched a new website to educate the public on surprise billing limits and to host an IDR portal for payers and providers.The Arbitration ProcessThe interim final rule applies to insurers or to self-insured employers and their third-party administrators disputing charges billed by out-of-network health care providers. These disputes typically arise after the out-of-network provider bills a patient for the difference between the charge and the amount paid by their plan, known as “balance billing.”In brief, here is how the process will work:Before initiating the federal IDR process, the disputing parties must initiate a 30-day “open negotiation” period to determine a payment rate. If negotiations fail during this period, either party may initiate the federal IDR process, and the parties may jointly select a certified IDR arbitrator to resolve the dispute. The parties will submit their offers for payment along with supporting documentation. The arbitrator will then issue a binding determination, selecting one of the parties’ offers as the out-of-network payment amount. Both parties must pay an administrative fee ($50 each for 2022), and the nonprevailing party is responsible for the arbitrator’s fee.Standard Notices”Each step in this process requires the parties to provide written notice to the other party or the federal government,” wrote Katie Keith, a former research professor at Georgetown University’s Center on Health Insurance Reforms and a contributor to the Health Affairs blog. “To aid the parties in doing so, the agencies created various standard notices,” she explained. “If a provider wants to initiate the open negotiation period, they must inform the plan or insurer and send written notice within 30 business days of an initial payment or denial of payment.”The open negotiation period then extends for 30 business days from the date of the notice, Keith explained, and “the parties must exhaust this open negotiation …

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