Employees will pay more out of pocket for healthcare in 2011

Hewitt Associates has released a study illustrating that employers can expect 2011 health care cost increases to be at their highest level in five years. The study cites higher medical claim costs, aging population and changes brought about by health care reform as contributors to this.

Per employee health insurance premiums will be at $9,821; a $66 per month increase from 2010. Employees are being asked to pay 22.5% of this or $2,209. This employee contribution is up 12.4% from 2010.

Average employee out of pocket costs such as co-payments, co-insurance and deductibles are also expected to increase by double digits. Employees can expect to pay $2,177 in 2011 out of their pocket on medical bills. The total employee contribution of $4,386 per year is three times higher than what they average employee paid, $1,229 in 2001.

HSA’s could be a big winner in healthcare reform

Now that the healthcare reform bill has been signed into law, many people have healthcare and health insurance on their mind. A portion of the bill has many focusing their attention on health savings accounts.

The bill contains mandates that businesses with over 50 employees must purchase health insurance. The bill will require businesses to insure their employees by the year 2014. According to a Wells Fargo Benefits Marketplace Survey, many employers were already shifting health care costs to employees in 2010.

“Those who will subject to mandates in the future are looking for ways to control their costs before they get locked into something down the road” said Roy Ranthum, President of HSA Consulting Services. “Employers are already moving to HSA’s”

What does this mean to the average employee? The health savings account is paired with a high deductible health plan, meaning you pay your medical expenses (out of your health savings account) up to the deductible before your insurance pays anything. Depending on your health, it could lead to higher out of pocket medical expenses. To assist those with higher bills, we are available to review and negotiate their medical bills. INSNET performs risk free medical bill review and negotiation services for any medical bill over $200.00

Consumer Driven Health Plans are the real health reform

Cigna release a study showing that while medical costs continue to increase double digits annually, that costs for individuals enrolled in consumer driven health plans saw their costs decrease 26% over a four year period.

Critics of high deductible plans often state the reason cost decrease is due to the high out of pocket costs. They say that people are foregoing treatment because they cannot afford it. This study states that the level of preventative care, chronic diease management and evidence-based treatments were higher than those enrolled in PPO and HMO health plans.

The study further states that 18% of Americans are covered under a high deductible health plan. If this amount rose to 50% (it is increasing each year due to lower monthly premiums), the United States could achieve $350 billion dollars in savings over a 10 year time period.

High deductible health plans and Health Savings Accounts need to be in the forefront of discussions about health reform. More people can afford coverage (decreasing the number of uninsured), no taxes will be raised and medical costs will decrease. Isn’t that what reform should be about?

Lessons about healthcare reform from a computer technician

Our family computer was not working properly. I’m the tech guy in our household, so it was my responsibility to fix the problem. Not knowing the answer I Googled the symptoms and got many possible cures. The problem was, I couldn’t run any programs on the machine. It was time to call in the experts.

As you probably guessed, the machine had a virus, and due to the damage caused by the virus and also by the machine having a lot of dust, the best fix was to replace the hard drive. I was a little skeptical about this, the computer is almost 3 years old, and I know these are built to have increasing shorter shelf lives, but I listened to the technicians reason for repairing this machine instead of replacing with a brand new one. I decided to replace the hard drive, which cost me around $150.00. The machine now works great, better than before for sure.

What does this have to do with healthcare reform? Instead of a rash, overhaul of a fix (new computer), I opted for a small, less expensive repair. I would advocate three small repairs to the healthcare system. Less expensive high deductible health plans ,which makes consumers more accountable for the true cost of the healthcare, tort reform which will lower the award in malpractice lawsuits which increase insurance premiums which doctors pass the cost of on to patients, and thirdly, allow insurance companies to sell their products across state lines, the more competition involved, the lower the cost of monthly premiums will be. None of these repairs will increase taxes, and will help lower the cost of healthcare. I don’t think the same can be said for the current health bills.

A glimpse into what government run healthcare will look like

The town I live in is running a program offering to vaccinate school aged children for the flu as well as H1N1. I’ve lived in this town over 17 years and am not sure why it is being done this year.

A letter came home from all the schools in September announcing this program, with the shots to be administered by a third party agency in the first week of October. The notice mentioned that this will just be the seasonal flu vaccine, and will not protect against H1N1. Shortly afterwards, we got another notice stating that due to a shortage, the schedule vaccinations will take place November 9 – 14.  Another notice came out stating that there will indeed be a H1N1 vaccine, but the seasonal flu vaccine will not be available. Furthermore, the H1N1 vaccine would not be a shot, but instead a nasal spray (much to the delight of my younger children. Finally, the first day of vaccinations and low and behold, the seasonal flu vaccine is available along with the H1N1, in both shot and nasal spray form.  Not only did they get the wrong information out to the families, but they had 3 chances to it correctly and still didn’t get it right. Do we want all of our healthcare run like this?

Due to the size of our town, the vaccines are to be administered based on your last name (A-F the first day, G-M the second etc.) Sound like rationing to anyone?

Additionally, the vaccines are to be administered between 2:00 and 7:00 at the high school. My daughter who attends the high school went to register for the vaccines immediately after school ended at 1:45. She got in line behind others, who were already in a line extending outside of the school. I know people who waited in excess of 2 hours for their children to be  vaccinated yesterday.

Furthermore, there is no fee to be paid at the time the vaccine is administered. It appears to be a free program, which many will indeed believe does not cost them anything. How much are taxes going to go up to run this program this year and into the future?

Our healthcare system is indeed in need of change, but I believe that the government should stay out of it.