After four years of slower growth in healthcare costs, Orange County businesses could be digging a bit deeper to keep their employees insured in 2008.
Local employers are projected to pay 8.7% more on average in healthcare insurance premiums next year.
That’s up from 2007’s 7.3% increase, but still on the low side of the 8% to 18% jumps seen since 2002, according to Chicago-based human resources services company Hewitt Associates Inc.
The hike appears to be related to a health maintenance organization “profit-taking cycle,” said Paul Klein, a healthcare consultant in Hewitt’s San Francisco office who works with clients throughout the state, including OC.
“After several years of the HMOs battling to gain market share, they feel that they’re in a position now where they can take some profit,” he said.
Consolidation and market share issues have been at the forefront of the HMO world for some time, spurred by Minnesota’s UnitedHealth Group Inc.’s $9 billion buy of Cypress-based PacifiCare Health Systems Inc. in 2005.
Some local employers expect lower prices than what is projected.
For more on this story, see the Oct. 15 edition of the Business Journal.
