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The Business of Health Care Report
My topic this week emphasizes
awareness of health care costs as a means of stabilizing them. About now, thousands of North
Texans fortunate enough to have group health insurance have received a splash of
cold water in their faces in the form of changes to their premiums and benefit
plan designs for 2004. For the past several years, North
Texas employers have been faced with increases from 16 percent to 30 percent, averaging
20 percent annually in health care benefits costs. Employers have been forced to
acknowledge that runaway utilization of health benefits most significantly contributed
to the premium increases and that their employees have been largely insulated from the
true cost of services. The theory behind the most prevalent
plan designs for 2004 is that by raising premiums, coinsurance and deductibles, employees
will be more aware of the actual cost of health care. For example, it might surprise many
of you to know that when you go to a primary care physician for a routine visit, you pay
about $15 for a copay, but the physician gets paid about $90 by the insurance company. By changing to plans that require
consumers to pay a percentage of the charges rather than a fixed amount only, consumers
will have to pay more out of pocket. The hope is that they will be encouraged to stay well
and become wiser, more conservative users of health care. Many of you will recall this
design as the old indemnity type of plans, or, for most of us, the 80 percent-20 percent
plans - where consumers paid a deductible and then split the costs with the insurance
company. The transition to this type of plan
is not easy for consumers or their employers, but it's one that North Texas businesses
had no choice in making. For Texas Health Resources
and its family of hospitals - Harris Methodist Hospitals, Presbyterian
Healthcare System and Arlington Memorial Hospital - I'm CEO
Doug Hawthorne
with "The Business of Health Care Report" on NewsRadio 1080 KRLD.
©
2003 Texas Health Resources |
I'm Doug Hawthorne, President and CEO of Texas Health Resources, with
"The Business of Health Care Report" on 