The ADP Annual Health Benefits Report traces trends in eligibility, participation, and premium rates for employer covered health care from 2010 to 2013. The report finds that, as the full implementation of the Affordable Care Act (ACA) approaches, companies have begun restructuring their benefits packages and corporate coverage options. Changes in employer health coverage in recent years may reflect provisions of the ACA.

The report found that employer sponsored health care eligibility and participation rates among full time employees remained relatively steady from 2010 to 2013, with variations primarily based on demographic group. Although gender and marriage accounted for an insignificant percentage of eligibility and participation variations, age reflected more significant changes, possibly influenced by ACA regulation.

Age played an important role for employer health insurance coverage. Both eligibility and participation rates were higher for older workers. Fulltime employees age 50-59 participated in employer provided health plans at the highest rate, 72%. This trend is consistent with the overall aging of the workforce as the baby boomer generation continues to work into their sixties and seventies.

On the other end of the spectrum, the youngest employees participated least in employer health coverage. Only 50.1% of workers under the age of thirty participated in employer health plans. In addition, the under-thirty age group eligibility rate decreased the most, dropping by 4.6%. Because the youngest workers tend to make the least income and are generally healthier, they are less inclined to purchase health insurance. Thanks to the provision of the ACA that allows people to remain on their parents’ health insurance until 26, younger workers may remain on their parent’s coverage longer, and aging workers may continue work to provide these additional benefits to their older children.

An important change in employer health coverage is the cost of plan premiums. Premiums have increased in price every year. Between 2010 and 2013 premium rates rose 13.9% with a 7.6% jump between 2010 and 2011. But, after 2011, prices began to moderate and the rate of increase slowed, caused in part by employers reducing actual coverage value, using high deductible plans, or implementing consumer directed health plans.

Again, age remained a key factor in the rate of premium growth. The steepest rate of increase fell upon the under-thirty age group, increasing by 16.3% since 2010. The 40-49 age group maintained the highest monthly premiums, averaging $949 a month. These high premiums may also be attributed to the fact that this age group is more often covering their children until they reach 26.

Employer premiums varied widely state-to-state. The report found that New Jersey had the highest premiums at $968, but a low rate of increase. In contrast, Colorado maintained the lowest premiums at just $733. And while North Carolina did not have the highest rates, it had the largest percentage increase at 18.8%.

To view the full report: ADP Annual Health Benefits Report


In our second installment of the “On the State Exchanges Series,” you will learn about new insurance carriers added to state exchanges and news on state-based support systems for the exchanges. The State Exchange Updates Table continues to provide the latest information on carrier participation and plan rates as they occur.

Latest Updates:                                                

Maine– In the federally run marketplace in Maine, two insurance carriers will offer plans in 2014: WellPoint (Anthem Blue Cross) and Maine Community

Maryland– The state-run exchange in Maryland has signed on 13 insurance providers. Six will offer health plans: Aetna, Coventry, United Health, Care First, Kaiser Permanente, and Evergreen Health Coop. The remaining seven will offer solely dental insurance, BEST Life and Health Insurance Co., Delta, DentaQuest Mid-Atlantic Inc., Dominion Dental Services Inc., Guardian Life Insurance Co. of America, Metropolitan Life Insurance Co., and United Concordia.

California– California’s Health Insurance Commissioner, Dave Jones, has recommended removing Anthem Blue Cross from the states small business marketplace due to excessive rate increases. Anthem Blue Cross has raised small business health insurance rates by 17% in the past year. While Jones doesn’t have the power to monitor insurer’s rates, the law gives him the right to recommend the removal of insurers with a pattern of excessive rate increases from the exchange. This decision will not affect Anthem Blue Cross’s place on the state’s individual marketplace.

A bill was passed in the California state senate last week to increase transparency on the Covered California state exchange. The bill will require the exchange to make more of the contract information publically available.

Colorado– Colorado is providing $17 million to 58 organizations that will form the state’s “assistance network,” a network of organizations that will aid in enrolling participants into the exchange.

Minnesota-The call center for Minnesota’s new health insurance marketplace will be operational Sept. 3 to help prepare consumers for buying coverage when open enrollment begins.

Connecticut– Connecticut’s health insurance exchange has officially launched its state wide marketing campaign. Ads will soon appear on television, newspapers, digital media and radio to get residents thinking about the new health insurance marketplace, known as Access Health CT.

More state exchange plans and pricing information: State Exchange Updates Table

Medicare is constantly aiming to keep spending in line. A new study shows that making the change from expensive brand-name drugs to their generic counterpart could save Medicare billions. 

A new Annals of Internal Medicine report shows that Medicare enrollees are three times more likely than VA benefit recipients to choose brand-name drugs over generic, in part because the VA requires that patients try the generic option before switching to brand-name. All VA prescriptions are managed by the same pharmacy company and patients typically only get a branded version if there’s no close generic equivalent.

Outside of the VA, most doctors are inclined to prescribe brand-name drugs unless the patient asks otherwise. Meanwhile, many patients worry that generic versions of their medication won’t be as effective as their branded ones.

But the cost of generic drugs, while cheaper than brand-name, have their own pricing problems. Similar to the wild disparity between hospital procedures, generic drug costs fluctuate depending on location and pharmacy. For example, a 90-day supply of the generic equivalent of the cholesterol drug Zocor cost $51.99 at Safeway, $62.97 at Walgreens, $75.99 at Target, $122.99 at CVS, but just $9.99 at Costco. Not only are generic drug prices inflated depending on your pharmacy, getting information on what your insurance will cover at a new pharmacy proves difficult.

If Medicare Part D operated in the same way as the VA system, it would have saved $1.4 billion in prescription drug costs in 2008. CMS would do well to follow the VA’s example and encourage doctors and Medicare beneficiaries to try generic drugs first. And while choosing generic could save Medicare billions, more price transparency for generic drug options could also save big bucks for consumers.



With the deadline for the implementation of the state health insurance exchanges fast approaching, the pressure is on for the states to solidify their plans. The “On the State Exchanges” series will keep you up to date on the exchange developments, including tentative and approved insurers, projected rates, and relevant state news.

The sixteen state run exchanges, eight state-federal partnerships, and twenty-seven federally facilitated exchanges (FFEs) are all scrambling to be open for business on October 1st, the date that open enrollment for 2014 plans begins. So far, 11 states have provided information on the carriers that will participate on their exchanges, and just three have actually announced any kind of expected premiums. This State Exchange Updates Table provides the latest information on carrier participation and plan rates that have been announced so far for each exchange. We will update the table in real time as more information is released, so bookmark the link and check back frequently for the latest news.

The Recent Announcements:

On June 7th, Vermont officials received and began reviewing the first-ever proposed rates for health insurance plans offered through Vermont Health Connect. Plan rates are expected to be approved and announced by July 8th. Thus far, Blue Shield Blue Cross of Vermont and MVP Health Care have filed rates that are comparable with current rates paid by small businesses and individuals, but their proposed plans generally include improved benefits.

Fourteen carriers submitted proposals to offer 214 plans on Ohio’s health insurance exchange with average premium rates running at $420. Ohio officials say average prices will increase 88% with the implementation of the ACA, and critics worry that the increase will cause “rate shock.”

DC’s exchange will take on seven carriers offering a total of 293 plans. Over the weekend DC announced tentative prices for its spectrum of plans. A 27-year-old resident could expect to pay between $124 and $341 a month, depending on level of plan chosen. A 40-year-old would pay anywhere between $166 and $457 a month, and a 55-year-old would face costs ranging from $295 to $813 a month. In addition, the DC exchange is one of the few places where small business owners will be required to purchase employee health insurance.

More state exchange plans and pricing information: State Exchange Updates Table

Today, about 60% of workers in group insurance plans are in a self-funded plan.  But there is a tradeoff, greater risk for increased rewards. eBenifit News has compiled a helpful list of things to consider before switching to a self-funded plan:

  1. Risk Tolerance
  2. Cash Flow
  3. Federal Compliance
  4. Plan Management
  5. Separation of the Plan from the Company
  6. Exceptions
  7. Internal Plan Competition
  8. Education
  9. Plan Creation/Development/Amendment
  10. The Participants

Read the full article here:

10 Self Funding Considerations