Reports and Surveys | September 18, 2024
For 28 years, Segal has conducted an annual survey of health plan cost trends to give plan sponsors information they need to help make decisions. During the summer of 2024, we surveyed managed care organizations, health insurers, PBMs and TPAs. Collectively, the survey respondents represent more than 80 percent of the commercially insured and self-insured market.
The survey reports respondents’ 2025 trend projections for medical, prescription drug, dental and vision coverage. The 2025 Segal Health Plan Cost Trend Survey found the highest projected rate of increase for all health benefit plan cost trends is for outpatient prescription drugs: 11.4 percent.
The leading driver of overall projected Rx trend is drug mix, including higher-cost, single-sourced brand drugs and shifts to higher-cost treatments.
Share this page
Health plan cost trend is the measure of increases in allowed per capita claims cost. Allowed per capita claims cost is eligible billed charges (before participant cost sharing) less provider discounts.
Multiple factors influence trend, including new treatments, therapies and technologies, medical price inflation, and provider cost shifting from reduced payment by Medicare and Medicaid, to name just a few.
Although there is usually a high correlation between a trend rate and the actual cost increase assessed by a carrier, trend and the net annual change in plan costs are not the same. A plan sponsor’s costs can be significantly different from projected claims cost trends.
In addition to the double-digit projected prescription drug trend noted above, key survey findings about the coming year’s trend projections include:
In addition to presenting trend projections and trend drivers, the report:
It is vital for plan sponsors to monitor their actual health plan claims regularly to identify unanticipated cost drivers.
Plan sponsors in industries facing tight labor market conditions may be reluctant to pass on cost increases to participants. Effective cost-management strategies can help maintain reasonable trends and avoid having to require participants to share the burden of higher costs.
We recommend a balanced, three-pronged approach to effective healthcare cost management. It involves managing plan design/networks, vendors and population health. Data analytics are central to supporting each of those cost-management strategies.
Health, Public Sector, Multiemployer Plans, Healthcare Industry, Higher Education, Architecture Engineering & Construction, Pharmaceutical, Corporate
Health, Public Sector
Health, Benefits Administration, Multiemployer Plans, Public Sector, Healthcare Industry, Higher Education, Architecture Engineering & Construction, Pharmaceutical, Corporate
This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.
© 2024 by The Segal Group, Inc.Terms & Conditions Privacy Policy California Residents Sitemap Disclosure of Compensation Required Notices
We use cookies to collect information about how you use segalco.com.
We use this information to make the website work as well as possible and improve our offering to you.