Even as U.S. companies saw the lowest increase in health care costs in eight years, in 2006 health benefit costs continue to outstrip workers' growth earnings and the rate of inflation.

The average increase in 2006 was 7.9 percent, while the cost of health care for employers is projected to rise 7.7 percent in 2007, according to Hewitt Associates, a global human resources services company.

A recent Hewitt study found that the average health care cost per person at major companies will increase from $7,744 in 2006 to $8,340 in 2007. The costs employees must pay out of pocket, such as copayments, coinsurance and deductibles, will rise from $1,489 in 2006 to $1,627 in 2007.

In order to provide employees with a more holistic way to manage health, many companies
are providing education, decision support tools, integrated disease management, coaching, wellness and preventative care programs.

Employers also are responding to the rate increases by changing prescription coverage to encourage price transparency and condition-specific education in their plans. They are hoping to influence utilization and costs by incorporating more generic and value drug programs as well as pursuing aggressive PBM contracting and more substantial coinsurance in their drug plans.

Despite the overall decline in health care cost increases, employers should continue to be concerned about the cost of care for themselves and their employees. Companies need to move beyond cost sharing, consumerism and passive health management and focus on supporting behavior changes as people move from being consumers to becoming patients.

A leading healthcare accreditation body met last month with top pharmacy benefits management consultants as its latest step in developing voluntary PBM standards. Because of his experience with the industry and his standing as a leading PBM consultant, Arxcel’s Chris Robbins was invited to participate in the November meeting led by Washington, D.C.-based URAC, an independent accreditor of health care management organizations.

The project seeks to further URAC’s goal of setting benchmarks for the industry and to
better inform both consumers and policy makers.

A draft set of standards was released to the public in September and includes industry best practices for organizational and clinical quality; benefits management programs; pharmacy network access; and consumer education and support.

They cover the following areas: organizational integrity, clinical areas, operations, and marketing and communications.

The standards are posted on the URAC website, www.urac.org, and allow URAC-accredited organizations to measure themselves against each other with the goal of providing quality services.

At the November meeting, Robbins and the other participants helped URAC build
strategies for disseminating the standards and gaining broad acceptance of them.

Final standards are expected to be released by summer 2007.