Rising Health Care Costs Continue to Hurt Michigan Families, Overall Economy
LANSING - The Economic Alliance for Michigan recently released a report showing how rising health care costs are not only hurting employers, but also Michigan's working middle-class families and the overall economy.
The report compiles government data and the results of more than two-dozen economic studies to document the cause and impact of rising health care costs.
"The findings suggest that unless health care costs are contained, Michigan employers will struggle to create jobs and increase wages, leaving Michigan's working middle-class families struggling for years to come," explained Bret Jackson, president of EAM. "Michigan's leaders must strategically address rising health care costs to stop or at least ease this disastrous drain on the economy."
Some of the alarming findings come from the federal Agency for Healthcare Research and Quality data, which shows that for every four employees making $45,000 per year, their employer is paying more than $46,000 in health care premiums.
Jackson says that the money employers are spending on premiums alone is equal to the salary of one additional employee, meaning one less job that the employer can create.
"The reason why you're not getting the raise that you've wanted for the last five or six years is because of health care," said Jackson. "The reason why your company isn't growing is likely due to the health care costs that your company is facing."
To offset rising health care premiums, the report shows that employers are reducing employee hours, cost-shifting health benefit premiums onto employees, freezing salaries, and/or offering high-deductible health benefit plans.
Moreover, studies from the federal Agency for Healthcare Research and Quality show that the median average family income grew 4% between 2008 and 2013, while the average employer-sponsored family insurance premium increased nearly 35% and the employee's share increased 57%.
Jackson says immediate action from everyone is key in order to reduce health care costs in the long run. But until this issue is a top priority for lawmakers, Jackson encourages workers to consider all other available resources.
"One of the things individuals can do is use the resources made available to them to find out which providers are the most cost effective while still providing a very high quality health care experience."