Wrangling in Congress over health care reform hasn't succeeded in curbing the double-digit increases many Utah employers and workers will face for health insurance next year as open-enrollment season rolls around.
One explanation is that insurance companies and customers usually agree on the terms and conditions of health insurance plans at least 90 days before they go into effect. The House passed its reform bill Nov. 7, more than a month after most employers had signed contracts for 2010, and the Senate vote is weeks away.
Another reason is nobody knows which bill may emerge from the Senate and how it will be resolved with the House bill before a final measure goes to President Barack Obama.
Meanwhile, health care costs are still surging. And at the state level, where insurance companies are regulated, officials are waiting for Congress to act before they press for reforms.
"I don't think that health reform is really a driving force in how these negotiations [between employers and insurance companies] are playing out right now," said Kathleen Stoll, director of health policy at the nonpartisan advocacy organization Families USA.
As Congress continues to debate, premiums show no sign of reaching a plateau, forcing more businesses to pare back benefits or cancel them altogether.
"The trend for [2010] is still up," said Candace Daly, Utah director of the National Federation of Independent Business. Many of the group's 4,000 Utah members -- and their employees -- face hefty increases as they sign up for coverage next year, she said.
"They haven't seen any relief whatsoever. They are just seeing a normal trend, and the trend is about 14 percent," Daly said.
At that rate, health insurance premiums will double in less than six years.
Nationally, employers expect premiums to rise by about 9 percent in 2010 if they simply renew their current plans without making any changes, according to Mercer, a human resources consulting company. They hope to hold the line at a still-speedy 6 percent by making changes to their plans or changing insurance companies, Mercer said.
"I think that the current issues that Washington is wrangling with would not tend to cause private insurance companies to moderate costs," said Matt Wilson, chief operating officer of Orem-based Design Imaging LLC. His company, which makes tubs and shower stalls, saw its 2010 premiums jump almost 17 percent.
"In fact, my opinion would be it would go the other way and they would want to maximize their increases while the landscape is uncertain, not knowing what it would look like one or two years from now," Wilson said.
"This is an annual dance," said Chris Lee, a spokesman for the Kaiser Family Foundation. "Insurers say it will cost X. Employers say that's too expensive, and they negotiate or change benefits and carriers until they find a cost they can live with."
In September, shortly before the House passed its Affordable Health Care for America Act, the Kaiser Foundation said premiums for employer-sponsored health insurance rose to $13,375 for family coverage this year. Employers paid $9,860, on average, and employees paid the rest.
Family premiums rose 5 percent, while inflation fell 0.7 percent and workers wages went up 3.1 percent. The increase was small, compared with previous years. Since 1999, premiums have gone up 131 percent, while wages rose only 38 percent, according to the foundation.
In Utah, Regence BlueCross BlueShield raised its 2009 premiums for small businesses by an average of 9.2 percent, about the same as the previous year. Spokesman Mike Tatko said Regence hasn't seen much change in the posturing that the state's No. 2 insurance company and its clients adopt during negotiations. But that could change if a reform bill becomes law, he said.
"If you read the bill, there are profound changes that could affect our business. But until something is passed, it's difficult for us to make dramatic changes to the current business model we have," Tatko said.
Jason Burgess, spokesman for SelectHealth, the biggest insurer in Utah, said little has changed since the health care debate began. The company has retained virtually all of its large employers for 2010, he said.
"It is business as usual at this point in how employers purchase benefits for their employees," Burgess said in an e-mail.
Wilson, with Design Imaging, said there was no negotiating with his insurer over 2010 premiums.
"I would characterize it as an insurance company sending out a packet that they called a renewal, which to some is a word synonymous with [here is] your price increase," Wilson said.
The insurance company, Starmark, said Design Imaging's premium to cover nine employees would increase by 16.6 percent. The Lake Forest, Ill.-based insurer offered renewal options that would cut the increase, such as an increased deductible or a smaller percentage Starmark would pay toward a patient's bill.
In the end, Design Imaging decided it would not change coverages provided under its 2009 plan. It took the price increase, which went into effect on Tuesday.
