Health care costs <i>only</i> double inflation

Marketplace Staff Sep 26, 2006

KAI RYSSDAL: You hear the phrase health care costs and you know whatever follows is going to cost you money. And sadly today we’re no exception. Consumer premiums are up this year. And patients are bearing a higher proportion of their medical costs than ever. But an annual insurance survey out today does deliver *some hope. From the Marketplace Health Desk at WGBH, Helen Palmer has the story.

HELEN PALMER: Health premiums rose just 7.7 percent last year, less than in recent years. That’s the good news.

JON GABEL: Since the year 2000, premiums have grown 87 percent; wages have grown 20 percent.

Gabel is a co-author of Kaiser Family Foundation’s annual survey. He says the average family policy costs nearly $11,500 — more than a full-time minimum wage worker earns in an entire year. Gabel says rising costs have eroded coverage.

GABEL: Compared to 2001, there’s 7 million fewer workers receiving their health insurance from their employers.

Some of those workers can get insurance through a spouse or public programs but many don’t. So who pays?

GABEL: We’re all picking up the tab for the care those people are receiving.

Peter Lee of the Pacific Business Group on health says shrinking coverage hits workers pocketbooks. Employers push more costs onto workers so they can remain competitive. Lee says some just can’t afford coverage.

PETER LEE: Less than half of the smallest businesses in America — those with fewer than 10 employees — are offering health care at all.

One hot new idea to cut health costs is consumer-directed plans. Workers in these plans pay $2,000-$4,000 out of pocket before insurance pays a cent. The Kaiser Foundation’s Gary Claxton says few companies offer them.

GARY CLAXTON: You have to get employees comfortable with the idea of taking a lot more financial responsibility for at least their routine health care costs.

The businesses Kaiser surveyed said the only way they saw to cut health costs was more disease management programs — to help keep workers healthy.

In Boston, I’m Helen Palmer for Marketplace.

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