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Lockton releases findings of 2017 Colorado employer health benefits survey

DENVER, April 16, 2018 –  Results from Lockton’s 2017 survey of Colorado employers indicates their greatest concern is the shortage of qualified workers. Insurance rate increases and regulatory demands created by health reform were second and third among concerns, respectively. Lockton’s Denver office, part of the Mountain West Series, surveyed 285 Colorado employers in its annual survey regarding health benefits coverage and costs.

The average health insurance rates increased from 7.1 percent in 2016 to 7.7 percent. The increase in rates continues to outpace projected salary increases (2.5 percent). Despite the concern related to rate increases, benefits are ever more being used to attract and retain workers given the very tight labor market (2.9 percent unemployment). The availability of talent resulted in employers placing a renewed emphasis on the value benefits programs play in the recruitment and retention of employees.

The 2017 survey indicated that 10 percent fewer employers increased premiums to defray the cost of insurance rate increases than in 2016. The need to control the cost of coverage resulted in self-funding remaining the most prevalent financing mechanism in the 18-year history of this survey while high deductible health plan prevalence continues to hold at 57 percent.

The survey revealed that employers made great efforts to manage rate increases. As previously mentioned, the initial (gross) rate increase of 7.7 percent is higher than the 7.1 percent experienced in 2016. The resulting (net) rate increase after changes was reduced to 5.8 percent, which is 1.1 percent higher than the 4.7 percent in 2016 (23 percent higher net increase). The most common tactics employers used to bring the initial increase down included increasing employee premium cost, reducing benefits and/or changing carriers.

“The competitive landscape for recruiting and retaining top talent has placed a renewed emphasis on the value of benefits. Employer’s benefits strategies are as important as ever in regard to balancing the costs and the quality of benefits being offered to employees.” said Leo Tokar, executive vice president of Lockton Mountain West and the author of the survey.

He added, “The ability for employers to meet the demands of their businesses is dependent on the recruitment and retention of top talent. The importance of having a well-developed benefits strategy that includes a focus on plan cost, quality, and communication cannot be overstated.”

Survey respondents were selected based on size, industry, and visibility in the community. The survey was designed to engage a representative sample of Colorado employers to better understand the employee benefit trends in the Colorado market. This is not a scientific sampling.

More study results can be found here. Questions regarding the survey can be referred to Brock Squire.

About Lockton

Lockton is a global professional services firm with 6,500 Associates who advise clients on protecting their people, property and reputations. Lockton has grown to become the world’s largest privately held, independent insurance broker by helping clients achieve their business objectives.

For nine consecutive years, Business Insurance magazine has recognized Lockton as a "Best Place to Work in Insurance."

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Media Contacts

Brock Squire, 303-414-6276, [email protected]
Priya Nibert, 816-751-2398, [email protected]

    
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