Health-benefit costs rise

Health-benefit costs rise

The cost for businesses to buy health coverage for workers rose the most this year since 2005 and may reach $32,175 for a family in 2021, according to a survey of private and public employers.

The average cost of a family policy climbed 9 percent in 2011 to $15,073, according to a poll of 2,088 private companies and state and local government agencies by the Henry J. Kaiser Family Foundation in Menlo Park, California, and the Chicago- based American Hospital Association’s Health Research and Educational Trust.

The groups’ findings, based on data collected through May, show that health insurance is consuming a bigger share of employer costs, preempting pay raises and making companies pass on more medical costs to their workers, benefit consultants said. The premiums reported are in effect for the full year.

“Rising health-care costs have crowded out other elements of the compensation package,” said Randall Abbott, a senior health-care consultant at Towers Watson & Co. (TW) “That’s the price we are paying, beyond the fact that health-care cost in and of itself continues to be more expensive.”

Read the rest at Bloomberg.

Comments   

 
L Moore
0 #1 Rising costs a misnomerL Moore 2011-09-27 11:42:56
It is a mistake to attribute the constant increases in health insurance premiums to "rising health care costs." It is more accurate to attribute them to rising "insurance company costs" in which insurers take a significant percentage of every health care dollar to pay their top management huge salaries and bonuses.
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Lisa
0 #2 Rising Costs Don't Go to the DoctorsLisa 2011-09-27 13:30:06
Increased costs are a result of many factors, among them the lack of "across state lines" competition, mandates, regulations and litigation. It would be nice if the increased expenses for medical insurance meant that doctors, nurses and hospitals were being paid more but it does not. Having been in healthcare finance since l988 I have seen doctors' reimbursements decline year after year. Procedures are being paid at less than 50% of the rates paid in the l980s when the RBRVS system and the Medicare "overpriced procedure" rules decreased reimbursement substantially. Unfortunately for doctors the costs of doing business have also increased squeezing them from both sides.

Obamacare is a significant cause of these increases. Aside from thousands of pages of written prose, there are many thousands more pages of unwritten regulations that create uncertainty. Uncertainty in any endeavor increases costs. The various mandates also increase costs for everyone. If you offer "free" anything to one group, it means others are paying.

I hope someone with healthcare finance knowledge has some influence over future legislation or we can count on costs rising and access declining.
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