http://www.nytimes.com/2007/06/23/business/23retire.html?_r=1&oref=slogin
I hope this hasn't been posted yet. I also hope this is a growing trend.
I hope this hasn't been posted yet. I also hope this is a growing trend.
True. Which is why I think it's important that some anti-trust laws be revised to allow small businesses to "team up" to form their own larger groups. That's the only way they'll have the critical mass to effectively compete with larger businesses in terms of health care costs.All about bargaining power. Large employers can offer early retirees health plans. But small employers are eliminating insurance even for current employees.
It does. But until this happens, it's better than what we have now, because it crosses multiple employers and doesn't tie you your job any more (at least once you reach 55). It at least partially addresses the "golden handcuffs" a lot of workers have -- the fear of needing to qualify for individual health insurance with pre-existing condition exclusions and exorbitant rates for people with certain medical conditions.I know this article is from the NY times....but to blame business for these problems isnt going to go anywhere...on the contrary, I thought this board was under the consensus that health insurance needed to be removed from work...
Our elected legislature and executive branch should be ashamed.
True. Which is why I think it's important that some anti-trust laws be revised to allow small businesses to "team up" to form their own larger groups. That's the only way they'll have the critical mass to effectively compete with larger businesses in terms of health care costs.
Anyway, this plan is similar to something I've thought about for a long time: Even if businesses don't fund early retiree health care much any more, why can't they at least set up group plans that retirees can use to gain guaranteed-issue insurance?
Many businesses today seem to want to cut back on the number of higher paid, older and more experienced workers on their payroll. This would certainly be a potential way to do that; with less worry about health insurance if someone leaves their job, the decision to leave would be easier. I just wish they'd make 50 the eligibility age, not 55.
All about bargaining power. Large employers can offer early retirees health plans. But small employers are eliminating insurance even for current employees.
We have around 300 employees of which 150 - 200 participate in the health insurance plans we offer. Our costs have increased anywhere from 15% to 25% each year for the last 5 years. We fool around with the various deductables, riders, etc in an effort to reduce the amount of increase, but I fear it may just reach the point where it is unaffordable.
We have not used the HRA. It is not clear to me how the employer saves any money if I simply redirect dollars that would have been spent on premiums to an HRA pool. Also, the use it or lose it nature of the plan may be a turn off to plan participants.
OK - here's how you save. Number one, instead of throwing the money away on premiums, your putting money into a tax-advantaged account for employees to use IF THEY NEED TO.
Now, they don't get to take the money with them when they leave the company
Actually, it's an HRA pool (health reimbursement account - a little different than an HSA). But yes, you have saved money, because the money you put in your HRA is yours (belongs to the employer), not the insurance company's, and it's only spent if the employees use it. Most of the time, much of the money is not used, so it rolls forward - and all the while, the employer earns interest on the HRA account - instead of giving it to the insurance company in the form of premiums. There are algorithms that can be used to estimate how much of the HRA money will actually be used, and how much will roll forward each year.Ok, so far I haven't saved any money, the company is simply redirecting the cash to the HSA pool....correct?
It appears at this point, the company could save money by using the dollars left behind by departing employees to off set the current year cash contributions....correct?
I jumped into this conversation by simply pointing out what we have experienced as a small employer. My experience reinforced Martha's point that many small employers are reaching the position of not being able to offer affordable insurance to their employees. We spend a lot of time tyring to game the system in an effort to reduce cost. Unfortunately, it's not working and at some point, employers are gonna cry uncle and throw in the health insurance towel.