NEW YORK, November 14, 2007 – According to the most recent PricewaterhouseCoopers Private Company Services’ Trendsetter Barometer, most fast-growth private businesses (57%) claim to have suffered an impact from increased healthcare costs over the past 12 months, and/or expect to suffer wage/hiring impacts over the next year. Specifically, higher costs contributed to slower profit-growth (43%), while 38% foresee additional wage or hiring impacts in the next year. Anticipated hardships include lower wage increases for current employees (34%), slower hiring (10%), and/or hiring of more part-time versus full time workers (10%).

Overall success of current healthcare plans

Despite the negative impact of higher healthcare costs, most private company CEOs (58%) believe their current healthcare plans are "successful", while 21% say their plans are only "moderately successful", and 14% have been mixed or not successful However, nearly half reportedly have no metrics in place by which to objectively measure the effectiveness of their healthcare plans.

How “Trendsetter” companies measure success

A slight majority (51%) of “Trendsetter” companies report measuring the success of their healthcare plans. The most typical measurement used is “improved employee morale” (32%).

Measurements:	Total
Improved employee morale	32%
Lower healthcare claims and costs	18%
Increased productivity	11%
Reduced absenteeism	10%
Improved employee health	9%
All other (misc.)	16%
Do not measure	42%
Not reported	7%

Varieties of healthcare plans offered to employees

PPO plans are offered by 68% of private companies, followed by HMO plans (46%) and POS Plans (11%). Surprisingly, consumer-directed plans, which can often help lower costs and promote healthier life choices, are offered by only 6% of surveyed companies.

Plans Offered:	Total
PPO Plan (Preferred provider organization plan)	68%
HMO Plan (Health maintenance organization plan)	46%
POS Plan (Point of service plan)	11%
Consumer Directed (Qualified high deductible plan)	6%
Indemnity Plan	1%
Other plan	3%
Not reported	7%
Average # offered	1.4

“Given the high cost of healthcare, private company CEOs need to look at alternative options like consumer-directed plans and wellness programs that could result in cost reductions and promotion of healthier life choices. They may also consider measuring the effectiveness of their current plans to ensure they’re providing the right resources and options for employees,” said Barry Barnett, principal in PricewaterhouseCoopers’ Global Human Resource Solutions group.

Wellness program offerings

Currently only 28% percent offer a wellness program and 3% intend to do so. Nearly 60% of “Trendsetter” companies do not offer a wellness program, nor do they plan to offer one in the next 12 months. Those that do offer wellness programs emphasize healthcare information services (88%) and exercise programs (71%).

Tools made available to engage employees as healthcare consumers and assist them in making informed decisions regarding their own health and wellness are:

Online physician and hospital locations	61%
Online wellness tools	45%
Online quality information on medical providers	43%
Access to nurse advice (via phone or Internet)	39%
Online pricing estimates for medical services	24%
Health risk assessments	20%

Costs and benefits: private vs. public companies

Nearly half (42%) of the "Trendsetter" CEOs say costs of providing healthcare benefits to employees are higher than those of large, public companies; 31% disagree. Of those with higher costs, a majority (55%) do not believe they are at a disadvantage in competing with public companies for talent, but 42% do.

PricewaterhouseCoopers’ “Trendsetter Barometer” is developed and compiled with assistance from the opinion and economic research firm of BSI Global Research, Inc.

PricewaterhouseCoopers’ Private Company Services is an integrated team of audit, tax and advisory professionals who focus on the unique needs of private companies and their owners. Within the group, professionals concentrate on the needs of law firms, manufacturing, retail, wholesale and distribution, construction and food and beverage companies, as well as the needs of other professional service organizations. Private Company Services professionals are committed to delivering cost-effective, practical solutions and proactive services to their clients. For more information about PricewaterhouseCoopers’ Private Company Services, visit www.pwc.com/pcs.

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