Cost of Health Care Benefits Seen Rising 14.5% This Year

Retail/wholesale grocers and foodservice distributors experienced a 12 percent increase in healthcare costs over the last two years and they expect costs to rise another 14.5 percent in 2001, according to a new survey.

Results of the 2001 Healthcare Benefits Survey were released today in Houston at the Food Distributors International Productivity Convention and Exposition. The study, prepared by K-Management Resources, is a comprehensive review of the elements of FDI members' healthcare benefits packages and charts the results of 47 member companies (21 foodservice distributors and 26 retail/wholesale grocers) who participated in the survey, which was conducted in August.

Among other key findings:

* Retail/wholesale grocers (77 percent) are more likely to be at least partially self-insured for their healthcare benefits than foodservice distributors (50 percent).

* The median medical plan cost per employee is $2,772 annually, the average cost per employee is $3,353.

* Only 19 percent of foodservice distributor companies and 42 percent of retail/wholesale grocer companies have an indemnity medical plan option for their employees, while 100 percent of survey participants from both groups offer a managed care plan.

* Both classifications of companies are less likely to absorb all of the increased healthcare costs. More than half of the participants surveyed said they are passing a portion of cost to employees and searching for lower cost alternatives.

The survey presents data on the four primary elements of a healthcare benefits package--medical, dental, vision, and prescriptions--as well as other selected elements, such as employee assistance, wellness and fitness programs.

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