Rise in Worker Healthcare Costs May Slow

The average cost of healthcare per employee will rise 7.7% for major companies in 2007, the lowest increase in eight years, benefits consultant Hewitt Associates said Monday.

The cost per employee will probably be $8,340 next year, more than double the $4,018 of 2000, Hewitt’s survey said. The cost in 2006 is $7,744, Lincolnshire, Ill.-based Hewitt said.

Two recent surveys forecast a similar decline in cost inflation. Menlo Park-based research group Kaiser Family Foundation said employer premiums would rise 7.7% this year. Towers Perrin, a Stamford, Conn.-based consulting firm, predicted a 6% rise next year.

Hewitt said employees would probably contribute $1,678 to the premium and pay $1,627 in out-of-pocket co-payments, deductibles and partial insurance payments next year. That total, $3,305, is 7.8% more than this year.

The average employee earning $40,000 a year can expect a salary increase of 3.7% next year, or $1,480, Hewitt said. A 7.8% increase in total healthcare costs would swallow 16% of that raise.