Putting his wife, Hillary Clinton, in charge of promoting his health insurance reform plan known as the Health Security Act, Clinton intended to enact legislation that would require virtually all Americans to enroll in a health policy, which would be managed by regional purchasing cooperatives.
By , Clinton's plan died in Congress, largely because it was considered too radical an overhaul of the healthcare system. This left the major portion of healthcare still in the hands of employers. To deal with the growing number of employers who were dropping coverage because of rampant inflation, the HMO as we know it today was born.
Employees were generally unhappy with managed care options, as they wanted greater autonomy concerning their health decisions. Meanwhile, healthcare costs continued to rise. In , in response to the crisis state of American healthcare, President Obama signed into law the Affordable Care Act.
While it remains to be seen what the long-term effects of Obamacare will be, there is little doubt that we are in the midst of a new chapter in America's turbulent healthcare history.
The economic strain caused by the COVID coronavirus pandemic has complicated the challenges employers face when managing their employee benefits program and forecasting health care costs for their employees. While future impacts to costs and the course of the coronavirus pandemic are unknown, employers , most notably those with self-funded group health plans, must be mindful of this variability, as well as the wide swings in predictions from experts across the board.
Regardless of which way things play out, they need to take careful steps to ensure the financial viability of their health plans during this crisis. As of September , employers have been patiently waiting on renewal figures from carriers to start setting contribution levels for the plan year. The healthcare industry as a whole initially braced for higher claims when the pandemic began, and from April through June most employers enjoyed historically low claim costs.
The increase in the use of telemedicine also helped to defray claim costs. While employers are hoping the reduction in claims would result in favorable renewal rates, to date it appears most carriers will be offering only modest increases.
This is likely due to the possibility of pent-up deferred care, along with the potential second — and maybe even third — waves of coronavirus cases. To that end, as we addressed in one of our blog posts from May, " The Financial Impact of COVID On Self-Funded Employer-Sponsored Group Health Plans " , there are several steps that self-funded employers should take to prepare for any shifts in claim costs, not the least of which was an adjustment to claim reserves.
Historical evidence suggests that the current expense reduction related to deferred care won't re-materialize post-pandemic. Net, a dollar-for-dollar pent-up need for care may not emerge when the pandemic finally subsides. Fully-insured employers will be at the mercy of what their carrier partners are anticipating. Conversely, self-funded employers could have the opportunity to recap the reward of two concurrent years of lower claims in the event carrier fears about higher claims do not materialize.
Fully-insured employers who are dissatisfied with their renewal quotes may want to go to market with their plans. Employer-based healthcare came out of a market-driven response by employers after World War II. It grew out of a strong economy, low unemployment rates, and intense competition for talent. Now, employer-based health benefits is the most common form of health coverage in America, with approximately million people under 65 in receiving employment based healthcare.
But what will happen now that the economy is wobbling due to Coronavirus and rising unemployment rates? While this is much improved from the The carriers gave self-funded plans for which they serve as third-party administrators the option to do the same. Employers have discovered that they will have to do far more than simply change coverage options for COVID related illnesses to remain competitive. Mental Health Services: Since pandemic began, employers have looked for ways to provide employees with meaningful mental health and emotional well-being resources to reduce burnout and treat mental health issues such as anxiety, loneliness, and depression.
Larger employers in particular are helping address access and cost barriers by securing mental health services onsite. Many employers are reducing out-of-pocket costs as well by either lowering or waiving fees altogether for virtual mental health services. Many employers are additionally providing increased access to other online mental health support resources such as apps, videos, and additional on-demand information.
Still others are implementing manager training to help supervisory staff recognize mental and behavioral health issues and direct employees to the appropriate services. Dan Gorenstein Jun 28, Listen Now. Share Now on:. Stories You Might Like Why having a job makes it more likely you have health insurance. Here is where the U. Congress buys its health insurance. Why are most health plans tied to the calendar year?
With fewer people on health insurance, health care jobs could be in jeopardy, report says. Also Included in. Tags in this Story. Share this Story. Latest Episodes From Our Shows. Read More. By the s, a majority of Americans received their health insurance through their employers, a development that began only in the early s.
Yet, relying on employment as a method to obtain health insurance left many behind: the elderly, unemployed or those who cannot work for other reasons, and of course, children.
Still any attempts to expand insurance through means unrelated to employment were met with fierce resistance. With the passage of the Affordable Care Act, which as designed would have required states to expand Medicaid eligibility to low-income Americans, 26 states successfully sued the federal government to avoid this requirement.
While many initially reluctant states eventually chose to expand, to date, 14 states have not expanded Medicaid, leaving many low-income Americans uninsured. Furthermore, under the Trump administration, states have successfully petitioned to add work requirements to Medicaid accessibility, a harmful and unproven measure, most recently struck down in Michigan by the US District Court in Washington, DC. While employer sponsored health insurance is popular in the US, it is expensive, inefficient, and favors high earners.
While the employer pays much of this, on average over a quarter of premiums are paid by employees, in addition to ever-increasing copays, deductibles, and other forms of cost sharing. Yet these benefits are not taxed, a long-standing tax quirk that disproportionately benefits higher earners with higher tax brackets. Furthermore, there is little incentive for efficiency and cost-saving measures in employer-based insurance, as high spending on health insurance is simply translated into higher premiums.
Employment-sponsored insurance favors insurance companies and those in high-paying jobs. It has many downsides, including promoting job-lock, hindering innovation, and keeping salaries low. It also, as we see now, is incredibly ill-suited for a widespread public health catastrophe like the COVID pandemic. Opinions can change, and we should not let the health insurance industry be the primary shaper of public opinion on who deserves health insurance. Expediency creates new priorities, and reshapes deep-seated political beliefs.
The aftermath of the coronavirus pandemic should be an opportunity to rethink our overreliance on employment as a measure of value, and as a gateway to healthcare.
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