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HEALTH
CARE COSTS ROCKET< Employees
Vs. Employers
New
Workforce Offerings
HR
Technology Saves Money
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Storm strikes CEO's
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HEALTH
PREMIUMS SWELL, U.S. PUBLIC WORRIED POLL
Health Insurance Costs Stymie Small Businesses
FP Witness Decries Rising Rates
The rising cost of health insurance has made it difficult for owners of small businesses, including physicians' offices, to provide health care benefits for themselves and their employees. This creates gaps in coverage and fuels the nation's
health care crisis, said a family physician who testified before the House Committee on Small Business on Jan. 23.
WORKERS FEEL PINCH, COMPANIES SHOP AROUND
Tussles over rising health-care costs are
at the center of contentious labor talks
between U.S. employers and workers,
including Verizon Communications and the
Big Three automakers. And as the baby
boom generation retires, the numbers of
people on the U.S. retirement health
program, Medicare, will swell. That is
fueling a congressional debate about
adding prescription drugs to Medicare,
which now covers 41 million elderly and
disabled. Workers are feeling the pinch.
Costs paid by workers out of their own
pockets for prescription drugs and doctor
visits jumped by at least 50 percent in
just the last three years, the report
found. For example, workers are paying an
average $29 out of pocket for the most
expensive brand name prescription drugs,
compared with $17 in 2000, the study
found. And in a finding virtually unheard
of just a few years ago, 44 percent of
companies have a separate deductible or
co-payment for hospital services.
Companies are scrambling for better
deals. Sixty-two percent of companies are
shopping around to find a better
health-insurance deal.
HMO PROFITS - Premiums are rising a bit
less rapidly at big companies that take
on the risk of health insurance
themselves, so-called self-insured
employers like General Electric Co. This
suggests that part of the rise in
health-care premiums can be linked to
HMOs' expanding profits, experts said.
Nearly every publicly traded HMO posted
record profits in recent quarters, as
they raise premiums to cope with
underlying cost drivers such as
prescription drugs, hospital and doctor
fees. The Morgan Stanley Health Payor
index of HMOs is up 43 percent this year.
But it is misguided to cast HMOs as
villains because they are just playing
"catch-up" from an earlier
period when premiums trailed cost
increases, said Drew Altman, president of
the Kaiser Family Foundation. When HMOs
start moving into new markets, or compete
by seeking new members, premiums could
begin to decline, experts said. But they
added there is no sign of that yetn this
type of plan if it could reduce total
health care costs. Read
why employees prefer having a choice.
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