It’s that time of year.
You can tell we’re near enrollment time for health plans with the arrival of studies telling companies how much of a premium increase to expect in the coming year.
New York-based Segal Co., a benefits, human resources and compensation consultant, recently released a survey of managed care operators, health insurers, pharmacy benefit managers and health plan administrators.
The survey showed that health plan cost increases could ease a bit in 2007, though they’re still set to easily outpace inflation and wage growth.
Highlights of the survey:
n Premiums for preferred-provider plans are expected to rise 11.6% next year, while health maintenance organization rates are seen growing 11%.
Increases for high-deductible PPOs, a type of “consumer-driven healthcare” plan, are expected to be 12%.
For this year, Segal projected PPOs premiums to go up 12.4% and HMOs by 11.6%.
n For 2007, Segal’s survey detected slight regional variances that suggest regional providers may be able to negotiate deeper discounts in their markets than national providers.
In the West, managed care groups and third-party administrators, which work with companies that run their own health plans, forecast cost increases similar to national programs.
n On the dental side, the survey found mixed trends. Managed care dental plan costs are expected to go up 5.2% next year, the same as this year. Fee-for-service dental hikes are expected to average 7.5%, a half percentage point above 2006’s projection.
n Drugs,often the priciest element of a health benefits plan,are expected to go up 11.9% next year, which Segal said is nearly eight percentage points lower than in 2001.
“Although this news is positive, it is important to keep in mind that most projected trends rates remain in the double digits and continue to outpace overall inflation and wage increases by wide margins,” Segal said.
The Consumer Price Index for urban consumers was 4.1% as of July. Average weekly earnings are growing at about the same pace.
Going Private in Japan
Japan’s regulatory system for medical devices can make our own Food and Drug Administration seem touchy-feely.
A story in the Sept. 4 edition of the Business Journal detailed device maker frustration with Japan’s slow and cumbersome approval process.
But some advanced technology can make its way into the country pretty quickly.
“There is a loophole that allows physicians to access technology, but they do it through a private import process,” said Mike Neilon, president of Japan for Advanced Medical Optics Inc., the Santa Ana-based eye products maker.
A Japanese doctor could import a laser for eye surgery that hasn’t yet been approved by regulators there, Neil-on said.
“In theory, there shouldn’t be any lasers in Japan, but there are 200 lasers in Japan,” he said. “They privately import them under the physician’s name and then do off-label use of these technologies.”
The import program applies to any medical device that a Japanese doctor or hospital would require to treat patients, according to Neilon. Those who wish to do so must apply to the Pharmaceutical and Medical Device Agency, which regulates devices.
“It’s not widely done, but it can be done,” Neilon said. “It’s just not a huge thing.”
Study Ties Stress to Alzheimer’s
University of California, Irvine, researchers said they’ve found that stress hormones play a central role in the development and progression of Alzheimer’s disease.
Frank LaFerla, a UC Irvine neurobiology professor, and his colleagues injected mice for seven days with dexamethasone, a steroid that resembles the body’s stress hormones.
The result: levels of beta-amyloid, a brain protein, increased by 60%.
When beta-amyloid production rises, it can form plaques,one of the two hallmark brain lesions found in Alzheimer’s patients.
The findings could help doctors figure out what drugs to provide for elderly patients.
“Some medications prescribed for the elderly for various conditions contain glucocorticoids. These drugs may be leading to accelerated cognitive decline in patients in the early stages of Alzheimer’s,” said Kim Green, a member of the research team.
The Journal of Neurosciences published the results. The Alzheimer’s Association, the National Institutes of Health and the National Institute of Mental Health funded the study.
Bits and Pieces:
R. Judd Jessup, who most recently was chief executive of Irvine’s US Labs Inc., joined the board of AviaraDx Inc., a molecular diagnostic company in Carlsbad. Jessup was chief executive of US Labs when it was bought for $155 million by Laboratory Corporation of America in 2005. His background also includes serving as president of the HMO division of FHP International Corp., which eventually became part of PacifiCare Health Systems Inc., which now is a unit of UnitedHealth Group Inc. UC Irvine Extension is offering “Medical Device and Pharmaceutical Combination Products,” a four-part course, Oct. 20 through 28 at the UCI Learning Center in Orange. Information and enrollment: (949) 824-5414.
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