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What Goes Up, Must Get…Shifted

Posted by: Julia Eisman on Sep 15, 2008

Typically, what goes up must come down. But in the case ofrising health care costs, what goes up, must get...shifted. Health care costs areup nearly 6% across the board for next year, and to deal with the increase,according to the Mercer consulting firm, a majority of companies are shiftingthe burden to their employees in the form of high deductibles and out-of-pocketexpenses.  Hence, businesses can rein intheir own expenses and stay competitive, while workers bear much of the burden.

While the cost growth is lower than it was in previousyears, working individuals and families are still getting hit pretty hard:

Between 2003 and 2007, the average deductible for an individual grew from $250 to $400. For a family, it rose from $1,000 to $1,500.

What's even scarier, accordingto our report, is that as health care costs continue to rise, wages can't keepup:

Nearly one out of four Americans under the age of 65-61.6 million people-is in a family that will spend more than 10 percent of its pre-tax income on health care costs in 2008. Shockingly, the vast majority of these people (82.4 percent) have health insurance. And 17.8 million non-elderly Americans-more than three-quarters of whom have health insurance-are in families that will spend more than 25 percent of their pre-tax income on health care costs in 2008.

The point: individuals and employers are both struggling tomake ends meet. Yet while employers can pass costs along to their employees,individuals and families are stuck - forced into medical debt or evenbankruptcy.