Health-care costs maintain dramatic rise

Employers focus on wellness strategies to combat trends
By Sarah Dobson
|Canadian HR Reporter|Last Updated: 07/13/2009

The cost of pharmaceuticals surged 15.2 per cent in 2009, driven by factors such as an aging population and greater use of medications to treat ailments, according to the Canadian Health Care Trend Survey.

The increase in 2009 surpassed last year’s increase of 14.1 per cent, reversing a four-year trend of declining cost increases. (See chart on page 14 for a look at the overall health cost increases from 2005 to 2009.) Pharmaceuticals represent the largest portion — typically 60 per cent to 70 per cent — of employer health-care costs.

“With any cost increase at 15 per cent per year, which is so far from a normal cost increase like the consumer price index, you just have to look down the road and know this is going to be a huge concern (for employers),” said Michele Bossi, a Toronto-based practice leader in the health and productivity consulting practice at Buck Consultants, which conducted the ninth annual survey.