Regional Survey Finds Employers' Health Costs Up 7.2%

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Employers' health care costs rose 7.2 percent in the Pittsburgh region during 2008-09 -- the first time in five years the increase wasn't lower than during previous years -- according to a survey issued today.

Cowden Associates Inc.'s annual Employee Benefit Survey found companies continue to rely on increasing employees' contributions as the best strategy to contain costs.

Even so, employers may have found the limit for pushing costs onto workers, said Cowden Executive Vice President Vince Wolf.

"It was a bit of a surprise ... that the renewal increase actually was up from the previous year," Wolf said. "And the other surprise was that cost sharing was relatively flat, and continues to be around 20 percent for individuals and 25 percent for family coverage."

This year's Cowden survey was based on responses from 230 for- profit and nonprofit companies, plus government employers, primarily in Western Pennsylvania, but also in West Virginia and Ohio. The respondents include a mix of Cowden clients and non-clients.

"I think the Cowden survey results are pretty consistent with what I would have expected," said David Lagnese, a principal in the Pittsburgh office of benefits consultant Towers Perrin.

The survey found that within the three-state area, the average cost of individual coverage rose $204 per employee, or 4.6 percent, to an average annual cost of $4,644. The average cost for family coverage rose by $744 per employee, or 6 percent, to an average annual cost of $13,248.

Employees with individual coverage paid on average $78 a month for coverage, while workers with families contributed on average $282 per month toward premiums.

The three-state region remains a stronghold for employers that pay 100 percent of their employees' insurance premiums, the Cowden survey found.

More than 17 percent of respondents still pick up all of the premium cost for their workers, compared to 11.7 percent of employers nationwide. …