Each January, HR Hero conducts an online survey about health insurance and retirement benefits offered by our readers’ organizations. Most of the questions are similar each year and provide a good comparison to previous years. The one thing that changes is the essay question. And this year, boy did we hit a nerve with that one.
The survey’s essay question asked readers what problems they see for businesses under the current health care system and what changes they would like to see made in the next four years with a new president and Congress.
Some participants were adamant that government should stay out of the situation. Others were equally convinced that universal health care is the way to go.
But one thing everyone seemed to agree on was that costs are significantly hurting businesses and something has to change. Many participants saw record increases in their most recent health insurance negotiations and expect double-digit increases again this year.
The survey participants’ answers to the other questions help paint a picture of the companies they represent. Of the 645 people who responded to the survey, 98% said their company offered health insurance and 54% report having 200 employees or less. While those results show that the survey is not representative of all small- and medium-sized businesses, the survey may offer some insight into the struggles of small- and medium-sized companies that are currently offering health insurance to their employees and the decisions they are grappling with as they try to keep their businesses and their employees healthy in a volatile economy.
The following are excerpts of responses the the essay question from representatives of companies with less than 200 employees and who offer health insurance at this time. You can read the entire survey results at www.hrhero.com/survey/results.cgi?benefits2009. You also can read a review of the book Critical: What We Can Do About the Health-Care Crisis by Tom Daschle, President-elect Barack Obama’s nominee for Secretary of Health and Human Services and health-care czar at Resources for Humans.
- Health care for our employees has almost become too expensive for us to offer. We eliminated a position this year just to maintain health care for our employees. An increase in cost next year will almost certainly eliminate our ability to offer health care. Our increase this year was 29% – higher than anything you had on the survey. We have moved to offering a high deductible plan in an effort to contain costs. We have also raised the deductible to $1500 for a single person and $3000 for a family. Our options are becoming less and less.
- We need to see cost-containment controls put in place as the cost of medical benefits is a large part of our budget. We are anticipating a 15 to 20 percent increase in 2009, which we cannot afford. We may look at reducing the level of coverage if the increase is over 10 to 12 percent.
- The increase in cost is the outrageous. And it hurts the small businesses to the point of a crisis type of situation. To raise the deductible higher than $2,500 and take away any more of the benefits would make medical insurance not worth having. So what do we as an employer or an employee (do)?
- Increasing insurance costs are costing us out of good insurance for our employees. We took a less expensive plan for our employees last year and are looking at the bids for this year. They are up an average of 30% which is not very affordable, especially for those with families to cover.
- Businesses cannot afford to keep absorbing most or all of the cost of increases. In times like this when people are being laid off they will not be able to afford coverage under COBRA and will let their insurance lapse in order to pay other bills or buy food. The number of uninsured Americans is bound to rise which will in turn increase the cost of employer sponsored plans – who will subsidize the “free” care that an uninsured person will get if hospitals have to provide emergency care? Businesses! If I knew how to fix it I would have run for office. But it seems like time has come for a national program but it cannot be solely on the backs of employers.
- The occasional high-dollar claims seem to be what drives our costs up. I don’t want to see national health care, but if there was a way for government to assist with high-dollar claims, or to pool with larger groups to help spread out those costs, it would help.
- We love to offer a health plan for our employees, but would like lower premiums, of course, to be able to offer them full coverage and full family coverage. The decision to have employees pay a portion of their coverage was not a choice we made, it was a necessity due to the extreme premiums. If we are mandated to pay 100% of coverage, we will not be able to sustain our business if there is no assistance or lowering of premium.
- Rising cost of medical insurance and the cost of drugs forces small companies to cut back on the benefits of their medical plan and in some cases drop medical coverage all together. I am not in favor nationalize medical plan. We need to continue to work to find ways of offering affordable insurance.
- (We need an) affordable health plan for employer and employees. Our health care enrollments have dropped significantly this year and fear we will not be able to secure insurance companies to come on property and give quotes. If this occurs, we will not be able to provide health care benefits for employees in the year of 2010.
- The (problem is the) inability to maintain and or control the cost to provide adequate health care coverage for employees without becoming cost prohibitive for both the employer and employee. The government should establish a committee to review the escalating costs connected with the supply of medical services and supplies. This includes the costs passed on to the public in medical research, product development and manufacturing that have become excessive in comparison with other countries.
- Our insurance actually went up 42% this year and was not even close to one of your options (in the survey). We did not feel there was any basis for this huge of an increase. We will now have to change companies. The game of changing companies every 3 years is ridiculous. Premiums should stay even and we should not be forced to change policies when our usage does not match the premium increase. The drug companies are also getting stricter about what they will cover and how many hoops they will require people to jump through in order get the drugs that their physician has prescribed. This has to stop as well. Why have the drugs if the insurance companies won’t let anyone get them, without paying a fortune or without a lot of red tape?
- Current cost increases in health insurance are not sustainable. Small groups are at the mercy of the large health carriers and have no recourse if they want to continue to offer competitive health benefits as part of their employee recruitment and retention strategies.
- As for change: better coverage at less cost. What else? The cost to some workers to cover their families is to the point of not being affordable even for those who are now making good money. Also the cost to the company to cover employee only is approaching the limit of what we can bear. As for foreseeable problems: If the trend of the past several years of annual increases in premium keep on going like they have we may not be able to offer 100% coverage to our employees so the employees who already live from paycheck to paycheck will have to absorb the cost that the company cannot absorb. Where will it end if something is not done. We don’t know yet what our health care premium change is going to be this year. Our renewal is not until March. We can only hope that any increase will not be of such magnitude that we have to make dramatic changes that our employees are not going to be able to afford. It is a sorry state when people who are lucky enough to have jobs have to pay out a huge portion of their net income for health insurance for their families to the point that other necessary things in the life of their families have to be sacrificed.
- Health care needs to stay within the controls of the private industry, but industry needs to create true ownership to turn trends around. Companies need to eliminate the practice of following trends and dare to charter new paths. Today, after “flavor of the month” cost cutting efforts have not shown to be fruitful, many companies are finally seeing the importance of employee involvement to control costs. Where was that thought process 6 years ago? That was seen as an unchartered path. How would employees know how to control costs – we are the benefit experts. So instead we controlled costs by cutting benefits, moving to high deductible plans, passing on costs to employees, kicking employed spouses off of plans. Today, we are no better off with cost continuing to rise. Why? Because we never got to the root cause. Our company chose the unchartered path that many companies are finally seeing as the right path. We partnered with our employees, shared with them the cold hard facts of costs, educated them how to control costs, communicated to them constantly on where we stood as a company and much more. The results – with less than 200 employees, we have saved almost $2 million in health care projected costs in 6 years, improved benefits, had NO premium increases for employees since 2004, gave employees one month free premium annual 2 years in a row, our 2008 costs are below our 2007 costs and overall, we are only 8.3% above our 2003 costs. What other company can say all that? Congress doesn’t have the answers to solve this crisis but each company has the power in their own hands to solve it . . . if they are willing to go down unchartered paths and not keep doing what others have done – with no financial results.