Heritage Restoration, Inc.

Health Insurance Costs Effect All Of Us

This is a bit off topic for building repair, although it effects all of us. This was published as an Op Ed in the Providence Journal on May 11, 2013.

As a business owner, and member of the Health Insurance Small Employer Taskforce, I was concerned to see the Op-Ed by Blue Cross & Blue Shield of Rhode Island’s (BCBSRI) CEO Peter Andruszkiewicz in the Providence Journal several weeks ago. While it can be expected that premiums will increase somewhat in 2014 with all of the required changes stemming from the Affordable Care Act, the increases Blue Cross is describing seem out of line, and a significant burden for small businesses in the state.
The op-ed states that Blue Cross is proposing products with an overall average increase of 18 percent for individuals and about 15 percent for small groups. Health insurance is already the biggest overhead cost for Rhode Island businesses, with many employers having to sacrifice new hires, freeze salaries and forgo other staff benefits just to provide a significant contribution towards employee health care. Rate increases to the magnitude that Blue Cross is putting forward will further thwart the growth of our state economy.

BCBSRI knows that it cannot keep raising costs on employers and individuals hand over fist, year after year. They were at a Public Input Meeting just 3 months ago, when they heard employers tell them loud and clear that these rates were unsustainable and that they needed to do something differently. The Health Insurance Commissioner agreed on a small rate increase for the company, on several conditions including that they create a much lower cost plan by next year.
Medical costs increase for a number of reasons – most of which are related to the price and utilization of care. We know from a recent 2012 report by the Office of the Health Insurance Commissioner on primary spending, that total medical spending in Rhode Island has fallen over the years. So if utilization is down price must be way up.

I do appreciate that CEO Andruszkiewicz is in agreement that “(a)ll players in the system recognize the system has to change, but it is not happening fast enough to meet the needs of Rhode Islanders who buy health insurance.” I say then go back to providers and use your leverage to negotiate payment rates based on transparent actuarial cost analysis that employers can actually afford! You have the power to start this change today, and as an employer, I urge you not to wait another day.

The Society of Actuaries came out with a study this month that says Rhode Island is one of the six states in the country that is poised to see a 6% decrease when the newly insured population joins our existing individual and small group pools. It’s concerning that Blue Cross’ numbers are so much higher.
This question leads to the conclusion that as employers – as health care purchasers – we’re just not given enough information to make sense out of this health insurance conundrum. We’re asked to pay blindly, and pay more and more every year. We need transparency now. I want to know exactly where my health care dollars are going, and have a say in how they are to be spent.

And so, insurers need to go back to their drawing boards and come up with a cheaper plan. We won’t keep paying these rates- we simply can’t afford it. If we did, we wouldn’t have enough capital left to run profitable businesses and organizations. Insurance companies alone cannot drive the RI economy; we absolutely need small businesses to grow to drive the Rhode Island economy.

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