National PEO has been keeping its eye on the health insurance problem. Due to increased costs we see an ever dwindling population of contributors. This leads to higher costs for those who keep their health insurance. Those who stay in are typically those who need it and therefore are the higher users. Thereby creating more of a drain on the resources and ever higher insurance costs spread among fewer and fewer people. This has produced a situation where the industry by definition is in a death spiral.
In view of this relentless erosion of employer-sponsored medical benefits, the health insurance industry today unveiled a proposal to extend coverage to more than 46 million uninsured persons.
The trade group’s plan would rely on a mixture of expanded federal and state programs and tax credits for workers and their families to purchase private health insurance.
AHIP, as the group is known, represents almost 1,300 companies that provide health insurance policies, including traditional fee-for-service plans and managed-care plans such as health maintenance organizations.
The insurance industry said its plan would cost the federal government $300 billion over 10 years, but the proposal lacked specifics on how it would be financed. Other estimates of providing coverage for all have been higher, $50 billion to $80 billion a year. By comparison, the federal government already spends more than $530 billion a year on two giant healthcare programs, Medicare for the elderly and Medicaid for the poor.
The Kaiser Family Foundation’s 2006 healthcare survey found an average cost of almost $11,500 a year for an employer-sponsored family plan. National PEO has seen its Employers, particularly smaller businesses, shed coverage as costs have risen, and most individuals find it too costly to purchase a plan on their own. Which further reduces the pool of contributors.
Polls show that Americans strongly back guaranteed coverage for all, but support melts away if it would mean significantly higher taxes — suggesting that the next debate on overhauling healthcare will focus on controlling costs.
Already, U.S. employers say the high cost of health insurance for their workers puts them at a competitive disadvantage in the global marketplace. General Motors, for example, spent $5.3 billion for healthcare in 2005, more than it did on steel.
For the short term the best programs will be found on an individual small group plan.
The experts at National PEO can find one that is right for your small group. It won’t be cheap or a smoking deal, those days are gone…but the right one to take care of your employees when its necessary. Contact Crystal Pickering and discuss this soon!