U.S. Chamber Warns of Record Costs in Health Coverage -- More Options Needed to Combat Uninsured

WASHINGTON, D.C.-The United States Chamber of Commerce warned employers' spiraling health care costs threaten to undermine coverage for millions of working families and called for more market-based options to expand health coverage to the nation's uninsured.

"Employers can't continue to absorb record health care premium increases and remain competitive amid the current economic slowdown," said Kate Sullivan, Chamber health care policy director, during a Center for Studying Health System Change (HSC) press briefing on its annual health cost data. "We need to focus on expanding coverage to the 40 million Americans who lack health insurance, not enriching the benefits of those who already have it."

America's employers are facing record double-digit health care inflation this year, the highest rate of increase in nearly a decade. As costs escalate and the economy slows, companies may respond by scaling back or even dropping coverage or requiring employees to contribute a larger portion of the cost.

"Now more than ever, we need to take action to protect and expand coverage by building on what works in the employer-based system and providing more options to individuals and small employers," said Sullivan.

The Chamber advocates strengthening and expanding the current market-based system through tax incentives for individuals who buy their own health insurance, including refundable tax credits for those with low incomes and full tax code parity for all who pay premiums, and making coverage more affordable through pooled purchasing under ERISA for small businesses, individuals and the self-employed.

Of particular concern in the HSC study are rising costs associated with hospital care. As employers themselves, hospitals are struggling in the face of workforce shortages and greater demand for services from an aging nation, underscoring the urgency for immigration policy changes to meet this need. "Moreover, the Medicare and Medicaid programs have been shortchanging hospitals due to budget shortfalls," Sullivan warned, "and employers are being handed the bill for the difference."

The U.S. Chamber of Commerce is the world's largest business federation, representing more than three million businesses and organizations of every size, sector and region.

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