Bruce Sadler, PE
Brockenbrough

The Richmond Times-Dispatch had an article a couple of Sundays ago about health-care plans and how employers are passing along the cost increases to the employees. The article went on to suggest that next year's average cost increase will only be 5.4 percent, the lowest in 15 years. I don't like these articles because the media always insinuates that the employers are somehow responsible for the cost increases. Where do they get these ridiculously low annual increases?

Over the past three years, our firm has seen in-kind renewal rates go up 15, 18, and 25 percent. Thus, we have made many of the changes noted in the article, such as increased co-pays, reduced premium contributions for dependents, and even wholesale plan changes. Over the years, we've transitioned from a PPO, to an HMO, to what I would refer to as an HMO/Low-Deductible Hybrid. Our firm has made these changes in order to try to balance the employees' health-care needs along with the need to have a reasonable bottom-line. All the while, we have continued to pay the majority of the premiums for our employees and their families.

It should be pretty obvious to the media, and everyone else, that employers have nothing to do with the increases. It is our behavior and the laws of the free-market system that are responsible. I recently asked one of our employees how much their knee surgery was and he commented that he did not know.  In fact, he intimated that he really didn't care. Can you please tell me of any other service that you don't care how much it costs? But under the PPO and HMO model you don't have any incentive to know. If we don't ask about cost, or try to be a smart consumer, then there is no reason for anyone to try and control the costs. Everyone needs to realize we all have some skin in the game!

PS - If interested, there is a book by John Torinus Jr. titled "The Company That Solved Health Care", (yes, the title is a little too smug) that talks about some of the best practices related to consumer-driven health care.