Survey Says: Health costs are forecasted to rise 13.7% in 2005

A survey of 12 Canadian Health Insurers, by Mellon Human Resources & Investor Solutions Canada found that health costs are forecasted to rise 13.7% in 2005, down from 15.1% in 2004.

Inflation on prescription drugs is expected to drop to 15.13% from 15.6%, due to the removal from the market of certain blockbuster drugs over safety concerns. Medical plans are projected to increase by 13.6%, Hospital by 10.95% and Visioncare by 3.19%.

Increases in Visioncare can probably be traced back to the downloading of services for eye-exams from the Ontario government to the Private sector.

The utilization of Dental is also expected to fall from 4.96% to 4.38% plus the Ontario fee guide (+2.6%).

Finally, hospital inflation was forecasted at 10.95% down from the 11.07% in 2004.

Fortunately for plan sponsors, these numbers from the Insurance Carriers are undoubtedly overstated based on their conservative assumptions and their desire to earn a profit. Although, it is unrealistic to think that inflation has fallen into the high single digits, the trend in this direction (if sustainable) would be encouraging.

2018-04-17T15:56:13+00:00