Survey: Wisconsin employers pay more for health care benefits
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Monday, December 9, 2002 12:00 AM CST
MILWAUKEE (AP) -- Wisconsin employers are still paying some of the highest costs in the nation for health care benefits, a survey has found.
The cost of health benefits for employees in the state rose 14.8 percent this year to an average of $6,940 per employee, according to the survey released Monday by Mercer Human Resource Consulting.
That is 20 percent higher than the national average of $5,758 for workers in businesses with 500 or more employees.
Half of the state businesses surveyed were in the Milwaukee metropolitan area, where a Mercer study earlier this year found health care costs were 55 percent higher than the Midwest average.
In the latest survey, representatives at 69 Wisconsin businesses said they expected an increase in costs of about 15 percent next year. Nationally, employers said they expect to see a 13.5 percent increase.
General inflation was 2 percent in 2002.
The higher costs have a negative impact on commerce in Wisconsin as the expense of health care threatens to drive out business or prevent firms from coming or expanding here, said Jim Wrocklage, executive director of the Greater Milwaukee Business Group on Health.
While some reasons behind the higher costs can be defined, there remains a "community dynamic" contributing to higher costs, he said. The factors included in the community dynamic have yet to be quantified.
Wrocklage said employers here have been less willing than their counterparts in other states to make workers cover the costs.
Another reason is that employer health care plans continue to include a wide range of hospitals and doctors so that there is little "steerage" of employees to specific, lower-cost providers.
But that is slowly changing as employers and insurers seek deeper discounts by limiting the selection of hospitals and doctors that their employees can use, he said.
"The system is getting more costly, and we cannot continue the way we are," said Wrocklage, who also is vice president of HealthEOS, the state's largest preferred provider organization.
One company facing the pinch, Geo-Synthetics Inc. in Waukesha, is looking at health care plans for next year that steer employees to hospitals where certain procedures are performed at reduced rates.
"We hope to put a little more burden on the employee contribution side," said Robin Atwater, human resources manager for the environmental construction company, which has 175 employees.
Atwater said the company received insurance plan quotes for next year with increases ranging from 17 to 35 percent, but nowhere near the 78 percent increase in premium the company was presented with for this year.
George Quinn, senior vice president of the Wisconsin Hospital Association, said Wisconsin employer health plans generally have benefit levels that are higher than the national average.
He said employers in other parts of the country "are beginning to cut back on the total bill they are willing to pay."
Also, in Wisconsin, hospital systems "are not bargaining against each other for patients," he said.
There is little competition because nearly all hospitals and physicians are available through most employee insurance plans, Quinn said.
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On The Net:
Mercer Human Resource Consulting: http://www.mercerhr.com/
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