Employers struggle with health insurance costs - Jacksonville Business Journal:

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billion doctor’s bill, and industry leaders say it’es causing health insurance plans to increase deductiblesw and chip away at benefitsto That’s because when Medicaid and Medicare reimburse health care provideres at a lower rate than private insurers, some hospitals and doctor s shift the cost to commercial payers rather than absornb it. This type of cost-shifting, sometimezs called a “hidden tax,” is estimated to have increased hospital and physicia costs for privately insured patients by 15 accordingto , a Seattle-based consulting firm. Milliman has just releasedf a study commissioned bythe , the and two additionak health care companies.
It found that cost-shifting annually adds an estimatex $1,512, or 10.6 percent, to the average premiukm for a family of Scott Serota, president and CEO of Chicago-baser Blue Cross and Blue Shield, said cost-shiftint should be an area of focu in the upcoming comprehensive health care reform expectef in the new administration under President-elecf Barack Obama. Employers absorb the brunt of skyrocketingf costs, paying nearly three-quarters of the shift, accordinv to Milliman. But if they haven’ already, more employers plan to pass costes on totheir workers.
The Millima study comes on the heels of a nationalo survey to evaluate the health care plands ofnearly 2,900 released in late November by Spokane, Wash.-based . It founc that employers held net health benefit cost increaseds at about 6 percent in the current year for a fourthstraighg year, but that has meant shiftingh more cost to employees. Employers are evaluating all One-third of Florida employers plan toincrease co-payments and out-of-pocket expenses to mitigate risinh costs, according to the Mercer survey of 105 Florida-based employers.
Thirty-one percen t will increase employees’ share of the premiunm contribution and 20 percent will increasewemployee cost-sharing in some other way. That’zs on top of health plan deductibles that doubled last year tomake $1,009 deductibles the norm among U.S. In 2000, about half of employers imposed a deductiblat all, and when they did, the median amount was just $250, according to Mercer. “Employeed are in no better position to paythosew increases,” said Janice Donaldson, executive director of the Smalk Business Development Center at the Universit of North Florida.
“That’s a hard sell as an employerf to say, ‘Hey, I know you haven’tf had a raise this year, but insurance rates are goinbg up.’ ” Jackie Perry, executive director of , said some Jacksonvillew businesses have discontinued coverage tostay afloat, and a few have adder a retirement savings account or increased sick and vacation pay to compensatwe for little or no health insurance The study did not account for businesses with fewer than 10 employees.
More than half of all employerw in Duval County have fewer than five Mercer respondents estimated that if they did not make changes totheir plan, cost would rise by about 9 Changes to plan design and/or plan vendors were expectedd to lower their cost increasre to 6.4 percent.