Cost of Health-Care Benefits Soars; More Increases Seen : Workplace: A survey shows that the average expense per employee is $2,600 a year.

The cost of employee health benefits reached a record high in 1989 and double-digit increases are expected again this year, according to a study released Monday by a Princeton, N.J.-based employee benefits consulting firm.

A. Foster Higgins & Co. said its annual national survey showed that the cost of indemnity insurance plans rose an average 20.4% last year to $2,600 per employee from $2,160 in 1988. When added to the cost of dental plans and health maintenance organizations, total health benefit cost rose about 16% to $2,748 per employee from $2,354 in 1988, the company said. (Average medical plan costs rose 29.3% in the Pacific region.)

Indemnity plans offer the insured the most options in deciding health-care providers and reimburse whatever fees are charged, typically after a deductible. Employers who choose HMOs or who participate in a preferred provider organization (PPO) choose from a limited selection of doctors and hospitals, who generally have agreed to accept a set fee for their services.

The rise in indemnity plan costs was significant because a majority of employees continue to choose indemnity plans despite the fact that it costs them more out of their own pockets, said John Erb, a New York-based Foster Higgins managing consultant who was among the study’s authors.

“Sixty-two percent of our respondents offer HMOs. But when they do, only 33% of employees enroll. It’s higher in California--about 40%. PPOs are growing, but only 31% are offering PPOs,” he said.

The survey included 1,943 private and public employers. Analysts said the continuing increases mean that labor disputes over whether employees should share more of the cost are inevitable in the 1990s.

Employers who provide health insurance can’t expect much relief this year, Erb said. “Unfortunately, the situation will get worse before it gets better,” he said. He estimated that the average total cost of employee health benefits will top $3,200 per employee this year.

Erb said employers were successful in curbing double-digit increases in the early 1980s, but a new set of problems caused the most recent dramatic cost increases. “The magnitude of catastrophic claims is one difference. We’re seeing million-dollar claims,” he said. Catastrophic claims--those requiring expensive, long-term care--are more frequent because of the rising number of AIDS cases and the wider availability of expensive, advanced medical technology, he said.

Employers responding to the survey also said insurance premiums increased because of rising outpatient costs and increased use of mental health and substance abuse benefits.

Only one in 10 employers responding to the survey said the cost of medical plans decreased or remained stable in 1989. Cost increases affected virtually every industry and geographic region of the country, according to the survey.