Rising Healthcare Costs Affect Employers, Too

Posted on October 15, 2010

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Today’s New York Times has an article discussing changes that employees should expect in their health insurance options during this year’s open enrollment season. While the article is generally informative, the author takes a moment to include a brief dig at employers:

As in years past, employers will be rejiggering their plans with an eye toward passing much of this year’s increase in health insurance costs to employees.

It’s a nice line, but not completely accurate.

The rising cost of healthcare is a societal problem; it’s not an issue of greedy companies sticking it to employees.

According to studies by the Kaiser Family Foundation, over the past decade, most employers have managed to hold the line on passing increases on to employees. The following two slides illustrate the point (click each slide to see the original at the KFF web site):

The real issue is not the level of cost sharing between employer and employee, but rather the exponential rise in the overall cost of healthcare.

The full study is available at ebhs.kff.org.

Time will tell whether the new health care law will serve to slow the rate of cost increases. If it succeeds in doing that, then all of us – employees and employers alike – will be better off.