A growing number of corporations are taking steps to control rapidly rising health-care costs, but few have enough basic information to do so effectively, according to a study by the accounting firm of Coopers & Lybrand.
The study, which examined plans at 317 workplaces covering 673,250 employes with paid claims of approximately $865 million, found that about a third of the corporations surveyed use some form of cost containment.
But the study also found less than a third of the firms surveyed had gathered such basic information about health-care costs as the number of hospital admissions, costs per admission and average length of stay. And study found that a growing number of plans are self-funded, with claims paid from corporate assets or by a trust rather than by an insurance company that receives premiums from the company.
The second annual survey of health-care costs by the accounting firm found that the average annual claim cost per employe among the plans surveyed was $1,285. The average among a smaller number of firms surveyed last year was $1,158, but Coopers & Lybrand officials said that the two figures were not comparable.
A large number of variables besides cost control efforts determined costs, the survey noted. Costs were highest in the heavily unionized Midwest and in the West and lowest in the southeastern United States, the survey found. Costs also increased as did the income of those covered and were higher for larger plans. Costs also varied by industry, with the highest in the natural resources and construction industries and the lowest in the service industries.
"The ability to understand why these costs fluctuate may lead to productive ideas for cost containment," said Jerome Y. Halperin, national director of the Actuarial, Benefits and Compensation Group of Coopers & Lybrand.
The most popular strategies for controlling rising health-care costs among the firms surveyed included incentives for having clinical tests done before hospital admission rather than at the hospital and incentives for getting a second opinion about the necessity of certain types of elective surgery.