HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Wednesday, June 10, 2009

Tale of Health Insurance Renewal

DailyKos' Sarge in Seattle writes about the annual health insurance renewal process for his small business and states, 

Jennifer Xxxxx, RHU, and Rebecca Xxxxxx, SPHR opened the discussion, as always, with "good news and bad news".

The bad news being, as always, a huge increase in cost of our existing health plan for my small business comprised of 11 employees. This year that increase is 19%. It would have been a mere 4.5%, I was told, if not for the unlucky circumstance of my staff getting a year older. As it were, some of our employees have unfortunately slipped into the next age bracket. Having neglected to fire, as any shrewd and frugal entrepreneur would, some of my long time employees in favor of younger ones, I am presented with an $8,350 annual increase in health insurance premiums.

(I don't recall the excuse for the 22% proposed increase by Premera last year, all I remember is we dumped them for the more "reasonable" Regence plan which, nevertheless, at the time represented both an increase in cost and decrease in benefits.)

The good news, as always, was "we have options", a euphemism for passing more of the cost of health care onto our employees, who are already burdened with a $1080 aggregated annual payroll deduct (25% of the premium), 100% of premiums for additional family members, a fee so outrageous, no employee other than me opts for (more on that later), plus a $500 plan deductible, co-pays for office visits, tests, procedures, drugs, etc., and Lord knows what exclusions.

Jennifer works for Xxxxx Benefit Services, Inc. as a Health Insurance "consultant", meaning the various insurance deniers providers – Premera, Regence, Aetna, etc., pay her company a commission to enroll groups into their plans.

Rebecca works for the employee benefits/payroll company to whom we outsource virtually all of our human resource management functions: Payroll and related taxes, 401K, Cafeteria 125, health insurance administration, vacation accruals, employee orientation and handbooks, and so forth. . . .

As wonderful as my employee benefits company is (and their fees are reasonable), the health care expense for my family is nonetheless extraordinary, and illustrative of the inviability of continuing a market based health care system that relies on for-profit insurance providers.

Get this, Congress: Factoring in the 19% increase for my Regence health plan, which costs us plenty for deductibles and co-pays, and adding the separate VSP vision plan (which is pretty good relative to the small premium, actually) and pathetic Met Life dental insurance, the total cost for health "insurance", not health care, mind you, but health care "coverage", is, as proposed by two accredited benefits professionals, for my family of four, on an annual basis, $18,070!

Yeah, we have the greatest health care in the world. Lucky us! . . . .

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