Home

News

Contact:
Zack Hutchins
Director of Communications
518.465.7511

For Release — August 28, 2003

SURVEY CONFIRMS CONTINUING CHALLENGE OF HEALTH-CARE COSTS; NEW YORK'S EMPLOYERS, WORKERS BOTH SHOULDER HEAVIER BURDEN

SURVEY CONFIRMS CONTINUING CHALLENGE OF HEALTH-CARE COSTS;
NEW YORK'S EMPLOYERS, WORKERS BOTH SHOULDER HEAVIER BURDEN

ALBANY—Rapidly rising health-care costs are forcing employers in New York State to pay double-digit premium increases, as well as to scale back benefits and pass a larger share of the rising costs on to employees, The Business Council's latest annual survey of employers' compensation practices shows.

The increase in workers' burden comes even though more than seven in 10 employers themselves shouldered double-digit increases in premiums regardless of what kind of insurance they offered, the survey shows.

The percentage of New York State employers asking their workers to pay more of the costs of health insurance continues to increase significantly, the survey showed.

The Council's annual survey of New York State employers' compensation practices was conducted by Compdata Surveys of Kansas City, the survey company with the nation's largest database on pay and benefits information. The results of the survey were published in Compensation Data New York 2003, The Council's annual report on the results of the survey of New York State employers' pay and benefits practices. The 598-page book was released this week.

"As New York's workers celebrate a well-earned rest on Labor Day, many will be especially wearied this year by their own increasing health-care costs," said Daniel B. Walsh, president/CEO of The Business Council.

"Albany should reconsider health-insurance mandates and other misguided state policies that drive both employers' and workers' costs higher," Walsh added.

The survey showed that employers' costs are also continuing to increase, even as employers ask workers to share more in the burden. The table below shows the 12-month period covered by the survey.

In the survey, New York State employers were asked if they took any of nine different steps to try to reduce their health-care costs. The percentage of employers taking these steps to reduce costs increased in eight of the nine categories; in the ninth, the percentage stayed the same.

 

Type of plan
Percent of employers offering this plan that paid higher premiums

Average premium increase

Indemnity plan

90 %
18.2 %
HMO plan
88 %
14 %
Preferred-provider organization (PPO)
72.2 %
15.5 %
Point of service (POS) plan
73.2 %
14.7 %

In particular, in a 12-month period ending in April 2003, more than one-third of employers increased the employee portion of health insurance premiums, and nearly one-third increased deductible levels.

Step taken by employers to reduce health costs
% of employers taking this step in 2003
% of employers taking this step in 2002
Increased employee portion of premium
39 %
33.5 %
Switched insurance carriers
19.8 %
14.4 %
Increased deductible levels
27.3 %
22.9 %
Offered a choice of deductible levels
11.2 %
8 %
Increased employee co-insurance level
23 %
18.1 %
Implemented a managed care program
5.3 %
5.3 %
Became self-insured
3.2 %
1.6 %
Reduced benefits
12.8 %
7.4 %
Initiated an internal claims analysis process
3.7 %
2.7 %

Background on the survey: The Business Council sponsors the survey each year to collect information on pay, benefits, and related issues for New York State employers. The survey is the largest of its kind in the state with data from hundreds of organizations on more than 450,000 incumbent workers in 472 job titles, ranging from entry-level positions to top executives. This is the seventh year that Compdata Surveys has conducted this survey and The Business Council has published its results. The book provides information on pay and benefits broken down by region, number of employees, and industry sector. For all job titles, the sample size is reported. All industries except agriculture and retail stores are covered.

-30-