Hmmm. This doesn’t bode well.
From an employee and management perspective, the cost increases for our program cannot continue. Insurance programs are there to help us when we really need them for things such as catastrophic illnesses. Our program has had many benefit changes over the years which switched the focus; some were mandated and others were a choice to expand coverage. The time has come to go back to the original focus. Management has authorized a study to review our medical program to determine a new path forward. This study will begin in January and hopefully create a new program that provides for our basic needs at a more reasonable price. We cannot keep doing what we have done for the past few years.
That’s an official employee memo from our corporate HR manager. If I read it correctly, it sounds like the already-narrow coverage we have through the company will be getting still more narrow (catastrophic coverage only, perhaps, with high deductables/co-pays).
The memo does note how costs have been increasing for company coverage of insurance (around 60% of the cost, with costs increasing 18%/year, and the company plowing in an amount almost half of our annual margin to make up for higher-than-expected costs this year).
We’ve personally managed to duck this bullet for a while, getting coverage through Margie’s very generous benefits (and, as I’ve said before, for all that my salary is more than hers, if one of us had to quit to stay at home, I’m not sure it would make most sense for it to be Margie). But it’s obviously a large and growing and ongoing problem.
And, as much as I wish the government could wave its hands and make it all go away, I’m not sure I’ve seen a plan that doesn’t simply shift cost increases up the food chain, and turn “you have to pay higher premiums and do with lower service” from private insurance into “you have to pay higher taxes and do with lower service” from the government.
Hrm.
Particularly annoying when you’d worked enough in the medical insurance arenas to realize that escalating costs are chicken/egg situation wherein the Insurance Companies say they won’t pay 100% of any medical fee’s (instead decreeing a set portion for each procedure in the books), resulting in docs raising their fees high enough so that the percentage pay-off from the insurance company is enough to actually pay what they need, to insurance companies lowering that set percentage each year (or, to fight that off for a year, raising their rates), so that the docs again raise their rates…
I the individual clinic docs, General Practitioners, for example, are having a really good month if their insurance payment net is 30 to 50 percent of what they charge, but the way the system works, they have to charge the really outrageous sums in order to get that 30 to 50 percent: if they lower their fees, the payback from insurance drops in turn.
Nasty, ugly situation.
Damn, that’s harsh, Dave. My former company’s bennies saw a dramatic drop in recent years, and I suspect most are going to trim even further.
I don’t know what the fix is, outside of socialized medicine, which has its pros and cons.
I’ve had a sneaking fondness for socialized medicine, whether it’s a British or Canadian plan, for years. “If only …”
On the other hand, looking at the shape of Britain’s system, and even Canada’s, it’s not clear to me that it’s not simply turning from a system driven by profits to a system driven by bureaucracies and government budgets.
Part of the problem is society’s attitude — the feeling that everyone deserves every possible treatment, no matter the cost, no matter the likelihood of success (balanced by resentment that, even if I know when certain things don’t make sense, I don’t trust some functionary at InsuranceCo HQ — or in Washington — to make that judgement).
I do wish I knew what the answer was.
Here’s an interesting question: is the rising cost of medical care and the way that it is (largely) managed by medical insurance companies enough to cause anyone to actually get up off their duff and do something about it?
My medical plan is pretty basic. It kinda blows, really, and I’m lucky that I don’t have any specialised needs. Yet, the cost of sustaining it is pretty high and seems to get higher every year. Just this year, my firm cut out a contribution that they were making on our behalf to cover the increasing cost of the plan.
And, to put this in slightly larger perspective, the major negotiation point for the four week bus and train strike in LA was over medical benefits. Likewise, the seven-weeks-and-still-going strike by the grocery workers for the three largest chains in the region is also over medical benefits.
Is the rising cost of medical care and the way that it is (largely) managed by medical insurance companies enough to cause anyone to actually get up off their duff and do something about it?
It’s a campaign issue that’s been simmering for a decade or more. The biggest problem is that the folks who could make a systemic legislative change — if that’s what it takes — seem least incented to do anything substantive about it. The party out of power blocks any changes to the system (even from really-worse to just-bad). The party in power can face only criticism for not coming up with the magic answer, and is usually beholden to the conflicting special interests that have exacerbated the problem to begin with. And congresscritters of neither party have a personal stake in the matter, having their own Special Congressional Insurance Stuff (conveniently enough).
As to strikes — if the situation gets bad enough, yeah, that becomes an mechanism. Problem is, simply extorting the money from businesses to pay for employee coverage doesn’t do anything to reform the system — it just shifts the burden (and hurts businesses, thus the economy, thus workers).
The question is how to keep cost increases down without disincenting people from being medical providers, disincenting insurance carriers from carrying medical insurance, disincenting the medical and pharmaceutical industry from expensive R&D efforts, and still retain flexibility and accountability and compassion into the mix.
I haven’t seen any golden bullets for this one, and I’ve been following along for years, both from intellectual interest and from the perspective of a “victim of managed care.”