pricewaterhousecoopers finds medical cost trend low, employer efforts to contain them high

July 6, 2012

in research/reports

pricewaterhousecoopers (PwC) released a paper in early june that projects another year of low medical cost trend. they project an increase of 7.5%, the same as in 2012.

certainly, a portion of thanks goes to the economy, which has constrained utilization. PwC also identifies four factors that will deflate 2013 medical cost trend:

  • medical supply and equipment costs come down under pressure, competition and consolidation
  • employers and others turn to lower-cost options for delivering primary care services, such as retail and worksite clinics, telemedicine and mobile health tools
  • price transparency empowers individuals to choose and emboldens employers to exact price justification
  • brand-name drugs lose patent exclusivity and the related stranglehold on high-cost prescriptions

PwC also attributes cost containment to employers cost-shifting strategies to employees, whether through high-deductible health plans or increased copays. PwC notes a troubling complement to this cost-shifting that’s been discussed by others:

“This shift is changing behavior and ultimately utilization; some employees are learning to shop around for needed care, while others forgo elective procedures or possibly delay care. A recent HRI survey found that 46% of  consumers had delayed care at least once in the previous year, and 10% had delayed care five or more times.”

forgoing preventive and routine care is in nobody’s best interest, so PwC offers several items for employers to consider:

  • collect data and review the effectiveness of the company’s efforts
  • communicate, educate and facilitate wellness
  • promote value by offering low-cost options, such as onsite clinics and telemedicine
  • use value-based approaches to benefits to drive, reward and sustain the desired behaviors

review PwC’s data and register to read the full report here.



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