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Segal Survey Predicts Declines in Trends for Fifth Consecutive Year
Date:9/19/2007

NEW YORK, Sept. 19, /PRNewswire/ -- The 2008 Segal Health Plan Cost Trend Survey forecasts continued declines in trends for 2008, marking the fifth consecutive year of declining medical trends. And, although a growing number of health plans project single-digit trends for 2008, health plan costs trends are still significantly above general inflation. Key findings include:

-- Over the past five years, projected trend rates for point-of-service

(POS) medical plans (including prescription drugs) for actives and

retirees under 65 has declined from a high of 14.9% in 2003 to 10.5%

for 2008.

-- Prescription drug projected trends have declined dramatically, by

nearly nine percentage points, since their high of 19.5% in 2003. http://www.segalco.com/publications/surveysandstudies/2008trendsurveysupplement.pdf

-- Price inflation appears to be the biggest element of overall medical

plan trend, accounting for approximately 60% of overall projected

preferred provider organization (PPO) trend in 2008.

-- The survey found some regional variation in medical trend projections

- ranging from a low of 9.4% in the Midwest to a high of 11.7% in the

West.

The 2008 Segal Health Plan Cost Trend Survey compares historical forecasts to actual cost increases. The Survey reports projections for 2008 obtained from a survey of managed care organizations, health insurers, pharmacy benefit managers and third party administrators. The survey also covers trend rates for PPOs and HMOs, Medicare Advantage plans, dental and vision care plans.

According to Edward A. Kaplan, Segal's National Health Practice Leader, "The most successful plan sponsors are examining detailed claims data to determine what diseases, conditions, facilities and treatments are driving cost in
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SOURCE The 2008 Segal Health Plan Cost Trend Survey
Copyright©2007 PR Newswire.
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