May 16, 2014 - 4:45pm

Employers’ Health Care Costs Keep Rising, Despite Obamacare


Senior Editor, Digital Content

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Doctor with patient


One of Obamacare’s promises was that it would lower health care costs. As a reminder, here’s a video  montage of President Obama insisting that his health care reform would reduce costs:

Obama Promises To Lower Health Insurance Premiums by $2,500 Per Year

Now here’s an Los Angeles Times story on how employers’ health care costs continue to go up [emphasis mine]:

Employer healthcare costs are expected to rise nearly 9% in 2014, a slight improvement over recent years, according to a new survey.

However, that modest decline doesn't offer much relief to companies and their employees, who are seeing health insurance costs take a bigger bite out of their paychecks.

"Even though the decline is good news, most [health] plan sponsors still find 8% to 9% cost increases unsustainable," said Harvey Sobel, a principal at Buck Consultants, a benefits consulting firm that surveyed 126 insurers and health plan administrators nationwide.

Townhall.com’s Guy Benson found an NPR story about an Ohio company who’s coping with these increases:

AmeriMark, like most businesses, has been coping with rising health insurance premiums for years. This year, the company's initial estimate from a broker was a 30 percent increase in the price of premiums if they stayed with the same insurance provider. Lyons says they shopped around, chose a new company and changed some of the policy's benefits — such as increasing the deductibles and copays that employees pay as their contribution to their own health coverage. Such changes in plans have become increasingly common nationally in recent years as annual increases in health care premiums have become normal.

AmeriMark's president, Louis Giesler, told NPR that the company thought about dropping coverage next year but chose not to. However, if unsustainable cost increases continue, it could do so in the future.

AmeriMark is being proactive in addressing rising health care costs by promoting health and wellness programs for its employees. The U.S. Chamber’s Health Care Solutions Council recently held an event on how innovative employers are using these types of programs to improve value by increasing quality and reducing unnecessary costs.

Unlike bureaucrats in Washington, D.C. who think that more rules, regulations, mandates, and taxes will bend the cost curve down, employers like AmeriMark are looking for real solutions. They can't afford not to.

Follow Sean Hackbarth on Twitter at @seanhackbarth and the U.S. Chamber at @uschamber.

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About the Author

Sean Hackbarth
Senior Editor, Digital Content

Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.