Health Plan Trend Expected to Hold Steady in 2011

Segal Company's recently released 2011 Health Plan Cost Trend Survey estimates that medical and prescription drug cost trend will remain relatively unchanged from 2010.

The survey indicates that 2008 was the bottom of a downward pattern and that trend began elevating again beginning in 2009.  Also noted is that one of the short-term drivers of health plan cost trend is compliance with the new health reform law - the Patient Protection and Affordable Care Act.  

As reported by Business Wire, Key findings of the survey include:

• Compared to 2010, trend rates for indemnity plans and high-deductible health plans (HDHPs) are expected to decrease in 2011.

• Trend rate for preferred provider organizations (PPO) and point of service (POS) plans are slightly higher than in 2010.

• All 2010 medical plans types are projected to experience cost trends that are more than eight times higher than the consumer price index for all urban consumers.

• Prescription drug trend projections have remained below 10% for the last three years.

• Price inflation for inpatient hospital stays is the largest component of overall plan cost trend.

The complete findings of the 2011 Health Plan Cost Trend Survey can be found by clicking here.