It's Annual Enrollment Time: Brace Your Wallet

Halloween tricks were a warm-up. While Congress argues partisan, special-interest driven healthcare reform politics these next few weeks, many employees will be faced with a stark reminder of the need for reform. Yes, November is here – annual enrollment time for 60% of insured Americans. It is rapidly becoming known as “spend more, get less” time for group health plan participation.

Now, Joe Lieberman thinks healthcare reform is going too far, that a public option is “just unnecessary” and private health plan premiums will go up. He’s threatening to join a Republican filibuster because of his “concerns.” Uh, Joe? Don’t you dare. Those premiums have already gone up, with medical costs rising three times as fast as inflation. Premiums are skyrocketing with no public option, and AHIP has promised they will continue to do so. So if you filibuster to strip the people of their power, Joe, we will strip you of yours within the Senate.

But back to reality outside the Beltway. Group health plan premiums have risen 131% in the last 10 years, according to the Kaiser Family Foundation. Employee contributions have risen 128%. Since 2006, the percentage of individual insured employees responsible for deductibles of $1,000 or more has more than doubled, from 10 to 22%. Companies still offering health benefits in 2009 downsized them – 86% now offer only one plan. That group ironically includes Blue Cross Blue Shield of Florida, whose 5,000 employees will now be offered only a high-deductible plan. Meanwhile AHIP is decrying government involvement in healthcare due to supposed lack of consumer choice.

For 2010, the picture gets uglier, according to Time.com. PriceWaterhouseCoopers says overall medical costs will rise 9%. Expect 40% of employers to shift even more premium cost to employees, and 39% to increase deductibles, co-payments, co-insurance, and out-of-pocket maximums. In fact more employers are gravitating to catastrophic healthcare policies that carry deductibles of $5,000 to $10,000 (I’ve been subject to two of these plans in the last 4 years.) Smaller employers are dropping coverage all together.

If that doesn't make you feel queasy enough, I have a challenge for you: ask your HR director how much your entire monthly premium is, before your employer's contribution. Then figure out what it would be under COBRA (i.e., if you left the company, willingly or unwillingly) by adding 2%. Let us know in the comments!

A friend of Change.org member Aaron Sidner, who recently found out she will be furloughed with US Air, was dumbfounded to find out her monthly COBRA premium is $1,000. She had been paying $100 per month while employed, just 10% of the total premium cost. Ouch. Of course, the government is still subsidizing 65% of COBRA premiums for those recently laid off. But that's actually you and me paying the bill.

Now for the hardest reality: no reform proposal being negotiated in D.C. changes any aspect of this dire situation. Except for a potential public option becoming available to small businesses, the employer-based insurance market is essentially left alone. Heck, Ron Wyden’s attempt to address it was soundly smacked down … by unions. I still remember Safeway employees picketing in the Bay Area in 2003 because their new contract required them to pay a small amount – for the first time ever – toward their health coverage.

Hopefully preventive care, wellness programs, and pay for performance programs will one day bend the cost curve. A strong public option available to everyone (the ideal Medicare For Everybody concept) could do more to diminish the financial appetites of an insatiable private insurance machine and “pay for quantity” provider juggernaut. But in the meantime, with nothing like that on the horizon, brace your wallet.

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