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.
For example, there was broad agreement on reducing the Medicare age from 65 to 60 or selling a public health plan option on the state healthcare exchanges.
To contain the cost of providing care, the employers said, the government should also prohibit anti-competitive practices by doctors, drug manufacturers, and insurers.
Many employees have already reached the breaking point. Clearly, their employers have too.
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