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Health Plan Executives Foresee Continued Decline in Small Business Enrollment, According to CSC Survey
Date:12/17/2008

Majority Predict Increase in Consumer-directed Plan Participation

FALLS CHURCH, Va., Dec. 17 /PRNewswire/ --Nearly three-quarters of health plan executives expect the current economic crisis to have a greater impact on their business than the 2001-2002 downturn, according to a survey released today by CSC (NYSE: CSC) entitled, "Insuring the Future: Health Plans Respond to the Financial Crisis." While few expect immediate changes in enrollment and membership levels, more than two-thirds expressed concern that continued rising unemployment would drastically affect their plan operations and profitability.

Fifty-four percent of health plan executives expect small group/business plan renewal to decrease as businesses fail and other market pressures force small companies to eliminate health coverage for employees. Large employers are expected to maintain their commitment to group health insurance coverage; less than 31 percent of health plan executives expect a decrease in large group plan renewals. However, almost three-quarters of plan executives foresee an increase in consumer-directed plans with higher deductibles and lower premiums as employers shift more of the cost to their employees. Nearly two-thirds expect an increase in government program enrollment as economic disruption and unemployment expand welfare participation.

Fewer than 15 percent of health plan executives predict significant layoffs or other cutbacks in their immediate future. Cost-cutting efforts will remain a top priority, according to almost 50 percent of those surveyed, as will projects directed at growth in selected market segments.

Plan executives also expressed concern regarding their provider networks, where the effects of unemployment and economic dislocation are felt almost immediately. Of those surve
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SOURCE CSC
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