Newsmakers June 13-26: Employers shifting health-care costs to employees

A study produced by Seattle-based health-care analytics company Milliman Inc. last spring showed that employees’ health insurance costs rose faster than those of their employers as the employers shifted more of the burden to combat increasing premiums.

The Milliman Medical Index showed that employees’ health insurance costs rose 6 percent in 2014 compared to 5.4 percent for employers. The study also showed that it costs more than twice as much to insure the average family in 2014 compared to 10 years earlier, a figure that rose from $11,192 to $23,215.

According to the study, 2014 marked the ninth year in a row in which families’ health insurance costs have risen by more than $1,100.

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The study came as Colorado and other states launched investigations into why health-care costs continue to increase so dramatically. Colorado lawmakers earlier this year approved creation of the Colorado Commission on Affordable Health Care.

The reason for the shift from employer to employee, according to Scott Rankin of Greeley-based insurance brokerage Leading Edge Financial Group, is that as premiums go up, employers can only afford so much before they’re forced to stop providing benefits altogether.

The only solution to slowing premium growth, Rankin said, is to reduce health-care costs. But a U.S. Bureau of Economic Analysis showed that health-care spending rose in the first quarter of 2014 at its fastest pace since 1980. Some of that can be attributed to expanded access to care thanks to the ACA, but it’s also due to higher costs at the provider’s office.

UPDATE

The 17-member Colorado Commission on Affordable Health Care – a collection of doctors, insurance industry representatives, hospital administrators and health-care policy experts – was officially commissioned in September and has met once per month since.

The ultimate goal is to analyze costs and make policy recommendations to the governor and lawmakers that could help lower those costs in Colorado.

Bill Lindsay, president of Lockton Benefit Group and interim chair of the CCAHC, said most of the work so far has been laying a foundation for the work the commission will do between now and 2017. That includes putting together bylaws and issuing requests for proposal for staff support.

Lindsay expects election of permanent officers and the hiring of staff to be completed by mid-January, when the real work will begin. The commission’s first report is due to the legislature in November of 2015.

Reporter Joshua Lindenstein contributed to this report.