Employers Willing To Pass Along Rising Prescription Costs to Workers - co-insurance plans likely - Brief Article

HR Magazine, March, 2001 by Bill Leonard

As prescription drug costs continue to rise, many employers believe that there will be a push to share more of the cost burden with plan participants through co-insurance arrangements, according to a recent study conducted by the International Society of Certified Employee Benefits Specialists.

The study, Employer-Sponsored Prescription Drug Benefits--A Closer Look, reveals that 65 percent of responding employers agree that rising drug prices will force plan sponsors to shift from a co-payment to a percentage-based co-insurance plan. Nearly 80 percent of the survey respondents currently use a co-payment structure, and this clearly indicates that a significant shift in the structure of many benefits plans may be close at hand, according to the survey researchers.

"Even the most aggressive cost-sharing co-payment plans don't begin to cover the average cost of prescription drugs," says Melody Carlsen, associate director of research for the International Foundation of Employee Benefit Plans. "Employers are looking to give their employees as much choice as possible, but they also want to attach a price tag to those choices."

Bill Leonard is senior writer for HR Magazine.