POLICY: And just in case you thought things were getting better

The answer is not much.

Aon surveyed more than 70 leading healthcare insurers and found that healthcare costs are projected to increase by 10.9 percent for HMOs, 10.8 percent for POS plans, 11.2 percent for PPOs and 10.7 percent for CDH plans. This represents rates of increase lower than one year ago, when HMO cost increases were 12.2 percent, 11.9 percent for POS plans, 12.4 percent for PPOs and 12.5 percent for CDH plans.

So in this survey premium cost growth rates are still well, well above wage growth. So a bigger and bigger share of wages (or the total available to pay wages) is going towards healthcare. And now the public sector, with its new accounting requirements, is starting to run into the same problems. So at some point those “unsustainable” trends start becoming apparent. While the NY Times focuses on the problems within the system, the LA Times has been focusing on the impact on financing and insurance. Maybe the word will get out of those two august organs and make it into the Six O’Clock news sometime.

But it’s all part of the same issue, and eventually there will be some kind of political solution. But of course things might get much worse before they get any better.

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2 replies »

  1. “I was particularly underwhelmed by the performance of consumer-driven plans.”
    But isn’t the free market going to save us from unaffordable healthcare? Doesn’t Eric Novack believe in the free market solution. Yea right, consumer driven healthcare is just a stop gap to preserve profits while making us feel just a little more in control. Where’s the beef indeed.

  2. I was particularly underwhelmed by the performance of consumer-driven plans. Makes me wish Ron was still around to wag a finger at. Check it out: Consumer-driven health plans had the lowest cost trend, with a 10.7-percent projected increase, but the difference was not statistically significant when compared with HMOs (a 10.9 percent increase), or POS plans (a 10.8 percent increase). Even PPO plans were in the same ballpark, with increases set to average 11.2 percent this year. Where’s the beef, ya know?