Newspaper article THE JOURNAL RECORD

Health Benefit Costs Rise in Oklahoma, but Less Than National Average

Newspaper article THE JOURNAL RECORD

Health Benefit Costs Rise in Oklahoma, but Less Than National Average

Article excerpt

Total health benefit cost for active Oklahoma employees rose 2.9 percent in 2010, less than half the 6.9-percent national increase, according to a new report by the global consulting firm Mercer.

Set under President Barack Obama's controversial health care reforms, the national mark represented the largest jump since 2005, at a rate five times faster than the 2010 consumer price index, according to Mercer's annual National Survey of Employer-Sponsored Health Plans, released Wednesday.

"It's not surprising that the costs are increasing," said Charles Foulks, chief administrative officer for OU Physicians in Tulsa and chair of the University of Oklahoma-Tulsa Schusterman Center Internal Medicine Department. "The fact that children are now on their parents' health plans to the age of 26 predicts this. It's not the least bit unexpected at all."

Not all executives would agree with that. Angela Acree, a Tulsa consultant with Mercer's Health and Benefits business, said respondents attributed only 1 to 2 percent of the cost increase to reform moves. The rest came from rising expenses.

"That's a concern," said Acree. "For these last few years the employers were kind of able to maintain those cost increases. They kept it to a good 6 to 6.1 percent.

"I think that the employers maybe didn't anticipate that it was going to spike up as much as it did this year, based on last year's projections," she said Wednesday. "Based on last year's projections, it appeared that employers were going to be able to maintain those levels."

Oklahoma's overall lower cost increase may represent the Sooner State's smaller percentage of large employers. The Mercer report said national firms with 500 or more workers endured an 8.5-percent health cost hike this year, almost double the 4.4-percent rise recorded by employers of 10 to 499 workers.

Such large employers represent less than 1 percent of Oklahoma- based companies, according to Oklahoma Department of Commerce statistics.

"The survey indicates that costs did rise faster among large employers," said Acree. "Total health benefit costs for large employers in Oklahoma rose 6.5 percent to $8,705, which is much closer to what the national increase was at 6.9 percent."

Acree said employers expect their 2011 health care costs to rise even faster as more elements of the Patient Protection and Affordable Care Act kick in.

If firms make only required changes under law, she said Oklahoma employers foresee an 8.7-percent health benefit cost increase, compared to a 10-percent rise expected nationally.

"Eight-point-seven percent is very high when you consider that cost-of-living raises and that sort of thing are probably going to be flat this year," said Denise Felber, a tax partner and health care specialist with the Tulsa-based accounting firm HoganTaylor. …

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