Kansas City, Kan. – The cost of medical coverage is on many employees’ minds as they near retirement. Prescription costs are of particular concern to baby boomers who rely on coverage through their employer. Despite medical coverage cuts, the 2008 Compensation Data – Michigan survey reported nearly all Michigan employers offer prescription drug coverage as part of their medical plan. The survey also found co-pay costs have increased for non-formulary and formulary drugs since 2006.
“The loss of medical coverage could deter many employees from retiring, and high prescription costs contribute to this,” said Amy Kaminski, manager of marketing programs for Compdata Surveys, the nation’s leading compensation and benefits survey data provider. “An individual taking two, non-formulary drugs a month could spend more than a $1,000 a year even with coverage from their employer.”
When comparing costs, non-formulary co-pays have risen steadily over the last three years. The 2008 Compensation Data – Michigan results found Indemnity plans had the highest co-pay, $50.00. In contrast, non-formulary co-pays on PPO plans were $43.24. Over the last three years, the cost on PPO plans has increased by 21.9 percent.
While co-pays for non-formulary drugs have increased in Michigan, formulary drugs have also seen a consistent rise in cost on flat dollar HMO, PPO, Indemnity and POS plans. In 2006, the average cost of formulary drugs on PPO plans was $24.90. This number has increased by 19.7 percent over the last three years. HDHP plans had the highest formulary cost this year, $32.14, and HMO had the lowest.
In comparison, co-pays for generic drugs have stayed under $12.00 on HMO, PPO, POS and HDHP plans in 2008. According to the newly released results, generic co-pays were $11.00 for PPO and $10.43 for HMO plans. On average, an individual could save $32.00 per prescription when choosing a generic over a non-formulary drug.
About the Survey
Compensation Data 2008 – Michigan contains data on 554 job titles ranging from entry-level to top executives. Information was collected on more than 212,000 employees across the state. The results provide a comprehensive summary of pay data, benefits information and pay practices with an effective date of March 1, 2008. Compdata Surveys, www.compdatasurveys.com, has been providing accurate, reliable data at affordable prices since 1988. For further information about the compensation and benefits surveys, contact Lane Odle at (800) 300-9570 or lodle[at]compdatasurveys.com.
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