Employers Preparing To Shift More Health Costs To The Employee

I’ve been arguing that the GOP’s health care proposals would shift the risk and the cost of insurance from the employer and the government to the individual. It’s what Jacob Hacker calls The Great Risk Shift. By relying on high deductible plans in the individual health insurance market and health savings accounts, Republicans are dismantling the kinds of pooling mechanisms that spread risks “across rich, and poor, healthy and sick, able-bodied and disabled, young and old” and shifting more of the economic costs and risks of insurance onto a single individual. That’s the essence of consumer-driven medicine.

Skyrocketing health care costs are already forcing employers to switch into plans with higher deductibles and co-payments and a new survey of employers finds that without significant reform, Americans will move faster towards the conservative health care utopia. A growing number of employers are predicting that unsustainable health care spending will force them to “charge more to cover spouses, tighten eligibility standards for their health plans and dispense financial rewards or penalties based on the results of certain lab tests“:

Meanwhile, employees at many companies can expect significantly higher premiums, deductibles and co-payments…the new survey is a reminder that even people who are satisfied with their insurance plans cannot count on a continuation of the status quo. With or without reform, coverage at big corporations is likely to become less affordable, and it could become more restrictive. [...]

In addition, employers are increasingly moving toward high-deductible plans, which carry lower premiums while leaving workers responsible for higher out-of-pocket expenses. Next year, 12 percent of employers plan to offer only high-deductible coverage, the survey found.

Conservatives have pushed back against health care reform by arguing that most Americans like the insurance they have. And indeed, reform advocates have had a difficult time engaging the insured majority — who feel insulated from the insurance problems of others. But many Americans in employer based coverage are already experiencing the kind of shifts the survey describes and I suspect if reform doesn’t pass this time around, those poll numbers will begin to shift. Nobody actually wants to use the Republican prescription. Especially when they get sick.