S&S Benefits.....Opinion, Hearsay & News Review

The Social Security Administration reports a spike in new disability claims which are expected to reach 3.3 million this year, up from an estimated 3 million just 5 months ago. The recession combined with an aging workforce is suspected to be the cause of the spike. It should be noted that this will probably cause even more delays in processing of claims. The SSA typically denies 2/3 of initial claims, while 61% are eventually approved for benefits. The appeals process keeps a backlog of 750,000 claimants waiting for appeals. And we want to entrust the government with healthcare? Just another reason to have private disability insurance.

A Towers survey of 433 employers says that if U.S. health reform leads to higher costs, employers will not absorb those costs. Eighty-seven percent of employers said they were very likely or likely to cut benefits or employees and raise prices rather than absorb costs. A Watson survey found that 73% of employers feel that health costs would increase under health care reform and that only 10% of employers would support an employer mandate to offer coverage.

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The Senate Finance Committee has released their version of health care reform. Under the proposal, a 35% excise tax would be imposed on employer provided health insurance (including dental, vision and FSA coverage) coverage in which premiums exceed $8000 a year for single or $21,000 a year for family coverage in the year 2013. (But they keep saying we need to pass the bill NOW!) The Senate proposal caps FSA contributions at $2,000 a year. It also would force employers to disclose health benefits cost as part of W-2 reporting to employees (gee, we wonder why they would want to do that?), and the whole bill would cost $774 to $856 Billion over 10 years (which is always an underestimate). In their infinite wisdom, Sen. Max Baucus and company think their tax on benefits that are “too rich” will raise $215 Billion from 2013 to 2019 to help cover the uninsured. They really think employers will not cut back on coverage and pay the tax. Great logic.

And while the government tries to force coverage on the population, it was noted in the Washington Post that the American Federation of Government Employees estimates that 250,000 or more federal employees are not members of the Federal Employee Health Benefits Program because they cannot afford the coverage.  Hmmm…if the government has to penalize itself, do we have to pay taxes for that?

The 2009 Kaiser survey is out and the percentage of employers with over 1000 workers that offer a CDHP plan increased from 22% in 2008 to 28% in 2009. Overall, 12% of employers offer the programs, but only 2% use health reimbursement arrangements as opposed to HSAs. Also in the Kaiser survey, the average HSA plan deductible for single coverage was $1,922 and the average family deductible was $3,734.

The survey found that 46% of employers with 3-9 employees offer coverage, while 72% of employers with 10 to 24 workers offer coverage. About 87% of those with 25-49 workers offer coverage and more than 95% of employers with 50 of more workers provide health coverage.

Average single coverage costs were $4,824 in 2009 and family average cost was $13,375. Employee contributions averaged 17% for single coverage and 27% for family coverage. Forty-five percent of large employers and 13% of small employers offer more than one type of benefit plan. PPO enrollment grew 2% to 60% of enrollment in 2009. Enrollment is HMOs and CDHPs was 20% and 8%, respectively. POS enrollment lost ground to 10% of enrollment.