PLANSPONSOR - February - March 2022 - 14

Planning for the Cost of Health Benefits
UPFRONT
THE CORONAVIRUS may have eliminated
another " old normal " : being able
to anticipate the next year's health care
costs. When budgeting for health-care
benefit costs last year, many employers
anticipated that the expense would drop
to the pre-pandemic level, says Arthur
Hall, senior vice president and employee
benefits national practice leader at USI
Insurance Services. " But the spread of the
Delta variant affected working populations.
Both fully insured and self-funded
plan sponsors paid a little more than
budgeted, " he says.
The volatility of the virus and the
Omicron variant have made planning for
health-care costs even more challenging,
suggests Julie Stone, managing director,
health and benefits, WTW. Her firm saw
employer medical benefit costs fall in 2020
and rise 5% in 2021; it expects them to go up
a bit more than that this year, she says.
TIDBITS
Many Women Miss Financial Milestones
Many women say they're on the wrong track for retirement
saving, with COVID-19 having made things worse.
58%
50%
47%
39%
59%
51%
34%
Contribute to a 401(k)
or individual retirement
account
Are building an
emergency fund
Source: Nationwide Retirement Institute
Increase their retirement
contributions
Are confident
about their retirement
plan status
49%
Women Men
Most self-insured plan sponsors will
set 2023 employee premium rates sometime
between this April and July, Stone
says, observing that it will be hard to tell in
March or April how the year will play out.
She advises plan sponsors to look at a full
six months of monthly details and consider
cost-management opportunities. Many
plan sponsors deferred making changes
to health benefits during the pandemic to
avoid increasing employee stress, she says.
" Sponsors should think about other ways to
manage health care costs. "
Cost-Saving Strategies
Encouraging their workers to seek care
to stay healthy is the single best thing
employers can do to manage long-term
costs, says Hall. " Employers need to
spend more time focusing on disease
management, preventive care and getting
employees to use in-network providers to
reduce costs for the long term. "
" In case there is a rebound in health
costs, plan sponsors should consider
high-performance networks and specific
clinical case management opportunities
depending on the needs of their employee
population, " Stone says. " Mental health is
top of the list for sure. But anything that's
a key driver of costs is important. "
Pharmacy cost is the easiest to
manage down and can make the greatest
impact, says Hall. According to USI's
" 2022 Employee Benefits Market Outlook "
report, specialty drugs generally represent
about 2% of all drugs dispensed; however,
with an average price tag of $84,442, they
account for nearly 45% of all prescription
costs paid by employer health plans.
" And it's not just the prescription
plan that's being affected; employers are
now facing a significant cost exposure for
medical plans from certain other drug
14 PLANSPONSOR.COM February - March 2022
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PLANSPONSOR - February - March 2022

Table of Contents for the Digital Edition of PLANSPONSOR - February - March 2022

INSIGHTS
INDUSTRY ANALYSIS
RULES & REGULATIONS
UPFRONT
Let’s Talk
Let It Grow
When Workers Retire in Stages
Virtual Lessons Learned
Managed Accounts, Today
How ‘Well’ Is ‘Well’ Enough?
Differentiation by Income
FIDUCIARY FORUM
INSIDE ANGLE
PLAN PROFILE
PLANSPONSOR - February - March 2022 - Cover1
PLANSPONSOR - February - March 2022 - Cover2
PLANSPONSOR - February - March 2022 - 1
PLANSPONSOR - February - March 2022 - INSIGHTS
PLANSPONSOR - February - March 2022 - 3
PLANSPONSOR - February - March 2022 - INDUSTRY ANALYSIS
PLANSPONSOR - February - March 2022 - 5
PLANSPONSOR - February - March 2022 - RULES & REGULATIONS
PLANSPONSOR - February - March 2022 - 7
PLANSPONSOR - February - March 2022 - 8
PLANSPONSOR - February - March 2022 - 9
PLANSPONSOR - February - March 2022 - UPFRONT
PLANSPONSOR - February - March 2022 - 11
PLANSPONSOR - February - March 2022 - 12
PLANSPONSOR - February - March 2022 - 13
PLANSPONSOR - February - March 2022 - 14
PLANSPONSOR - February - March 2022 - 15
PLANSPONSOR - February - March 2022 - 16
PLANSPONSOR - February - March 2022 - 17
PLANSPONSOR - February - March 2022 - Let’s Talk
PLANSPONSOR - February - March 2022 - 19
PLANSPONSOR - February - March 2022 - 20
PLANSPONSOR - February - March 2022 - 21
PLANSPONSOR - February - March 2022 - Let It Grow
PLANSPONSOR - February - March 2022 - 23
PLANSPONSOR - February - March 2022 - 24
PLANSPONSOR - February - March 2022 - 25
PLANSPONSOR - February - March 2022 - When Workers Retire in Stages
PLANSPONSOR - February - March 2022 - 27
PLANSPONSOR - February - March 2022 - 28
PLANSPONSOR - February - March 2022 - 29
PLANSPONSOR - February - March 2022 - Virtual Lessons Learned
PLANSPONSOR - February - March 2022 - 31
PLANSPONSOR - February - March 2022 - Managed Accounts, Today
PLANSPONSOR - February - March 2022 - 33
PLANSPONSOR - February - March 2022 - How ‘Well’ Is ‘Well’ Enough?
PLANSPONSOR - February - March 2022 - 35
PLANSPONSOR - February - March 2022 - Differentiation by Income
PLANSPONSOR - February - March 2022 - 37
PLANSPONSOR - February - March 2022 - FIDUCIARY FORUM
PLANSPONSOR - February - March 2022 - INSIDE ANGLE
PLANSPONSOR - February - March 2022 - PLAN PROFILE
PLANSPONSOR - February - March 2022 - Cover3
PLANSPONSOR - February - March 2022 - Cover4
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