A recent report has indicated that though health care costs are slowing they will increase by upwards of 10 % in the coming year.  

The report from Aon Consulting Worldwide, the consulting division of Chicago-based Aon Corporation was based on a survey of over 70 leading health care insurers including companies such as Aetna Inc. and Cigna Corp, who represented more than 100 million insured individuals.  

They estimated health care costs could increase 10.6 % for HMOs, 10.5 % for POS plans, 10.7 % for PPOs and 10.5 % for CDH plans.

Bill Sharon, senior vice president with Aon Consulting and director of the study said, "Unlike some other health care trend surveys, Aon Consulting's survey reports the expected future increase in employer-provided health plan claims cost before any plan changes, based on the opinions of health plan actuaries. We provide this trend data to help employers evaluate the competitiveness of health insurance premium renewals. For employers with self-funded health plans, this trend data helps them (and their actuaries) develop future claim estimates for budgeting purposes."

The estimated increase is though the smallest that Aon has seen in the last six years and could be attributed to the fact that more employers and employees utilizing employee wellness and disease management programs. “There's a variety of tactics that employers have been employing over the last 3 to 6 years that has had an impact on the market. But more must be done to truly stem the tide of rising health care costs. This includes greater senior management support for these programs, better employee communications and more consistent cooperation from the medical community," said Sharon.

Last year's forecast of 10.9 % saw a slight drop while 2002 showed a bigger fall when health care costs were estimated to rise by over 16 %. "Pretty much every employer has to do something or is doing something in an effort to bring that number down," Sharon said.

Aon says the increases are the lowest since the study began in 2001. It estimates prescription drugs to cost 9.2 % more, which is lower than the 9.5 % trend rate of a year ago, while specialty pharmacy trend rates are down to 12.2 % from 15.1 % in spring 2007. Ken Ambos of Equity Risk Partners Inc. a risk management and employee benefits consulting firm feels that midsize employers could face a cost increase of 9-12 % that they pare down to 6-9 %.

Robert Zirkelbach of America's Health Insurance Plans, a trade association representing nearly 1,300 insurers said, "It is encouraging that the growth in health care costs is going down, but there is still more work to be done.” Zirkelbach said overuse as well as misuse of services and an "out-of-control medical liability system" could be contributors to the increases. Health insurers have offered disease management programs as well as encouraged the use of cheaper generic drugs to try to contain costs as have doctors, hospitals and employers.

"When costs go up as great as this, there's a lot of market pressure brought to bear on all of the parts of the market to bring those costs down, and I think that's what's been happening over the last six years or so," he said.

Many employers have started researching their benefit options for 2009 though many experts feel it's too early for predictions on next year's health care plan costs. Although Aon Consulting had forecast a steady decline in cost increases since 2002, Sharon said this decline has grown smaller the past few years which could be a sign that the reductions may be bottoming out.