ACA: More than Meets the Eye in Price Hikes
Last night at the Republican Debate there was a lot of talk about the Affordable Care Act, and it reminded me of an article published in the St. Louis Post Dispatch last month that certainly caught my eye, and if you’re a small business owner, it should catch yours as well.
The article, titled More than meets the eye in health insurance price hikes, pointed out that not only are many programs going up as much as 30% on what is already high premiums (a point that is woefully under reported). Now let’s remember that the percentage increase is a dollar figure based on the existing level of the premium in the first place.
Jordan Shapiro, staff writer, writes:
Proposed double-digit price hikes for some health insurance plans are raising alarm bells about the affordability and success of the Affordable Care Act as it enters its third year of enrollment.
Numerous plans, including some in Missouri, are seeking premium increases as high as 30 percent. Opponents of the health overhaul have been quick to point to the price increases as yet another example of why President Barack Obama’s signature law is unworkable. But experts say they are reading too much into the information that has been disclosed so far.
In Missouri alone, Coventry Health Care wants their 70,000 clients to pay rate increases of up to 29 percent. Those 15,000 on BlueCross BlueShield fare a little better getting dealt “only” an 11 percent price jump. Our Senator Roy Blunt is quoted in the article saying that he’s hearing from voters who are unhappy with the double hit of higher premium rates with fewer choices.
Besides the mess that is Obamacare, the question the big insurance companies don’t want you to ask yourself is this: How do they make the exorbitant profits that they do? As I explain to our clients, they essentially sell you, the small business owner, services and products retail (premium price points) but they pay for it wholesale.
I say why not cut out the middle man, and control your costs by letting us negotiate all this for you?
When you break down the components involved, it’s about getting access to those services and arranging discounts, which we can do nearly 100 percent of the time. It’s a matter of cost management, unit cost and evaluating premium prices for services versus wholesale prices for services.” What’s the difference it can be up to 40 percent – as in a 40 percent savings to the employer while not compromising one bit on the benefits or services that he or she wants to have for their employees.
Small businesses need to control their cost more than ever. As the article says, “The health law radically changed the way insurers could price health plans by barring them from charging more to customers who were sick or had a preexisting medical condition.” The insurance companies are “flying blind” and those who don’t work to control their cost will deal with the consequences.
It has always been our focus to keep the base cost premium level as low as possible to minimize the actual dollar increase from the insurance companies.
But read the whole article and let me know what you think.