HEALTH CARE Premiums will rise even more, studies say

Health-care premiums are likely to rise by 50 percent by 2006.
HARTFORD COURANT
WASHINGTON -- Health-care consumers, stung recently by rising insurance premiums and eroding benefits, should not look for relief anytime soon, two new studies say.
The studies project that premiums will increase by more than 50 percent by 2006, that at least 10 million will join the ranks of the uninsured within three years, and that employers will continue aggressively shifting costs to workers.
"The picture in local health-care markets is pretty grim," said Cara S. Lesser, chief author of one of the studies, which was prepared by the nonpartisan Center for Studying Health System Change.
William M. Daley, president of SBC Communications, confirmed Lesser's conclusion. "The present course we are on is unsustainable," Daley said. "Employers can't continue to absorb double-digit increases in health-care spending year after year."
SBC is a member of the National Coalition on Health Care, an alliance of nearly 100 businesses working to improve the nation's health-care system. The coalition prepared the second study.
Trend to continue
Health insurance premiums have gone up at double-digit rates for each of the last three years, and the coalition's study projects the trend will continue for at least three more years. Average annual premiums for employer-sponsored family coverage will increase from $9,160 this year to $14,545 in 2006, the coalition projected.
Dr. Henry E. Simmons, the coalition's president, described most Americans as "apprehensive" about the affordability of health care.
The coalition's study predicted that rising prices will increase the number of uninsured Americans -- now 41 million -- to at least 51 million and as many as 54 million by 2006.
"These increases in premiums will make it more difficult for businesses -- especially smaller or less profitable firms -- to continue to provide health coverage for their employees," the coalition's study said.
A third study, by the Commonwealth Fund, said the rolls of the uninsured are being boosted by a growing number of young adults who lose their coverage immediately after they graduate from college. The problem has worsened over the last decade, the study said, as young graduates have been dropped from their parents' coverage and have not obtained insurance of their own.
Four of 10 young adults between the ages of 19 and 29 can expect to be uninsured at some time during the year after graduation -- twice the rate of adults ages 30 to 64, the Commonwealth Fund study said.
Paul B. Ginsburg, president of the nonpartisan health system research organization, said "there is little relief in sight" for consumers.
Cost-sharing increases
More employers are increasing cost-sharing than two years ago and employers are applying this strategy to a broader range of services, Ginsburg's organization reported. Employers that already required premium contributions are increasing co-payments and deductibles, the study added.
"The end result: Employees are seeing more of their paycheck going to premiums and are paying more out of pocket when they fill a prescription or see a doctor."
Ronald F. Pollack, executive director of the consumer group Families USA, said, "As employers shift more health costs onto the shoulders of their employees, an increasing number of workers will find those costs unaffordable."
But Dr. Donald A. Young, president of the Health Insurance Association of America, said, "Rather than succumb to a doom-and-gloom scenario, we must give the private market the freedom to innovate and the flexibility to meet the needs and preferences of the American consumer."