Posts Tagged "medical costs"

Employers Want Help with Health Costs

The cost of employer health insurance has skyrocketed, and workers are picking up some of that growing tab. Amid employees’ grumbling, employers are loath to push more of the cost onto their workers.

That’s why the consensus view among major employers, expressed in a recent survey, sounded like a cry for help. Calling rising insurance costs “unsustainable,” the vast majority said they need help from the government either to provide alternative forms of coverage or control health care and prescription costs.

Employers “have reached their limit,” said Elizabeth Mitchell, chief executive of the Purchaser Business Group on Health, an employer advocacy organization that collaborated with the Kaiser Family Foundation on the survey.

Employers, she said, “are tired of pouring tons of money into a broken health care market that delivers uneven quality at bloated costs.”

And these are the major corporations and non-profits with more than 5,000 employees. They have some leverage to negotiate with insurers and more financial wherewithal to pay for the plans. Smaller employers – if they provide health insurance at all – pay roughly the same premiums as large employers, and their workers shoulder a larger share of the cost for family plans.

Last year, employers with more than 50 workers paid $21,342 in premiums to cover employees with family plans – that’s still 50 percent more than a decade ago, despite a recent slowdown in health care inflation, according to Kaiser.

When employers’ insurance costs rise so quickly, that squeezes out money they might use for wages and other benefits. Workers are also paying more, though each employer decides how much of the added costs to pass on to workers.

In 2020, employees paid nearly $5,600 – more than a quarter – of employers’ total costs for family plans. To curb their health insurance expenses, employers increasingly are offering high-deductible plans, and the deductibles workers pay for these plans are also rising.

The major employers said in the survey that they’re open to a range of federal policies that would either cut health care costs or get the government more involved in providing health care. …Learn More

Medical Costs Slam a Minority of Seniors

As retirees’ health declines, their medical costs go up. These costs include both everyday healthcare expenses and long-term care costs.

The everyday expenses that Medicare does not cover – Part B and Part D premiums, copayments, eyeglasses, and dental care – consume about 20 percent of the incomes of households ages 75 and over. While not exactly good news, 20 percent is “perhaps manageable” for most, concluded researchers at the Center for Retirement Research in a summary of various studies in this area.

The real problem comes for the unlucky minority – about 5 percent of seniors – who spend more than half of their income out of their own pockets for healthcare.

Turning to long-term care, these services are less frequently required but can be very costly. For example, while many nursing home stays are relatively short, a lengthy stay is a potentially crippling expense. One common trigger for a long-term stay is dementia.

The retirees facing the greatest financial risk from health care expenses tend to be those who earned enough to buy a house and put money away in their employer’s retirement plan. They have more to lose if their wealth is eaten up by exorbitant medical costs. The poor, in contrast, are covered by Medicaid, which often pays for Medicare premiums and long-term care. …Learn More

Doctor: Why Medical Costs Keep Going Up

“We are rapidly approaching the point where we will simply be unable to afford medical care,” says Dr. Edward Hoffer. This is no exaggeration, according to the Henry J. Kaiser Family Foundation: health insurance deductibles and copayments are rising so fast that a significant share of working families have great difficulty paying for their care.

“We as a society have to decide whether healthcare is a right or a privilege,” Dr. Hoffer said. “I happen to think it’s a right. We can’t all drive a Mercedes but every American deserves to have access to healthcare.”

His book, “Prescription for Bankruptcy,” provides his insider’s view of why healthcare costs keep going up. For 46 years, he has worked in Massachusetts as a cardiologist, public health official, and hospital and private practice administrator.

Dr. Edward Hoffer

Question: How do U.S. medical costs compare with other countries?

Dr. Hoffer: The U.S. spends roughly twice as much per capita on healthcare as most other countries. Switzerland is nowhere near us, and they’re more expensive than the rest of Europe. Canada, Germany, France – they all have excellent healthcare systems and spend about half per capita what we do.

Q: What does this have to do with patient care?

A family policy costs the employer roughly $20,000 per employee per year, and many employers have been reacting by increasing employees’ deductibles and copays.  If you’re the line worker who’s making $50,000 and you’re faced with a $5,000 deductible, you behave like somebody who doesn’t have insurance. You skip your preventive care or you avoid a medication because all of this comes out of your pocket. Women are deciding not to get a mammography or someone who has a colonoscopy recommended to them looks at the prices and says, ‘Maybe I’ll put it off.’

Q: You criticize high pay for hospital administrators. You once visited a Boston hospital CEO whose office was so large that you “could barely see him at the far end.” But aren’t administrators crucial to the system?Learn More