When my father started his career in the 1960s, it was generally assumed he would have health benefits funded by his employer for the remainder of his life. But now, as he approaches retirement, those benefits have all but disappeared, with health care one of his largest monthly expenses.

This situation is not unique to my father. As business owners have become saddled with double-digit increases each year for the cost of health insurance, workers are seeing diminished policies, higher co-pays, and higher cost-shares with employers.  Today, many small businesses simply can’t afford to provide the same level of health benefits they used to – if they can afford to provide them at all.

The entitlement once afforded my father’s generation has gone the way of the $2 cup of coffee.

As a health insurance broker, I’ve observed many large corporations that are now hiring personnel for the maximum number of part-time hours – just to avoid the expense of offering health insurance. And there is an alarming trend now surfacing:  employers are opting to give their employees an increase in their annual wages in lieu of health insurance. This is not a Health Savings Account, a tax-advantaged medical savings account available to U.S. taxpayers in high deductible health insurance plans. Rather, it is a simple payout of additional wages - not affiliated with any insurance plan.

Such an arrangement may seem to work well for the employer, who no longer feels the obligation to offer employee health insurance. And, for the employee, the additional bump in salary appears to be a nice perk – at first.

Yet, if this practice becomes a universal trend, nobody wins. That’s due to human nature – many people tend to spend what they have and leave little left over for a rainy day. Without adequate health coverage in place, or the means to afford the escalating costs of medical care, the ramifications are sweeping. Simply stated:

• Employees without health coverage and their family members, unable to get preventative care or proper treatment for an illness, may become sicker, resulting in the loss of an employee for an extended period of time.
• Lacking other options, employees without health care and their family members may turn to the emergency room for non-emergency care.  Under the state’s charity care laws, the hospital must care for the sick person, whether they can pay or not.  That drives up health costs for the rest of us, as we are the ones who ultimately pay for that care.
• Without the buying power of the company behind them, employees will wind up paying more for individual health coverage than their employers would have paid to put them on group coverage.
• Older employees or those with existing conditions will be hit especially hard by the higher cost of health insurance.

While there is no easy answer to the problem of health care in America today, we can all agree that leaving employees on their own to find insurance, rather than giving them the benefit of group rates, is not the solution.  And if the next generation of workers can not expect adequate health care coverage from their employers, the numbers of uninsured workers will only continue to rise – careening our country’s health care into a crisis.

In our corner of the country, the New Jersey Association of Health Underwriters (of which I am a member) spends much time discussing the future of health care. After all, there is no one who knows more about health insurance. We are the ones who meet every day with the consumers and the insurance carriers.

Health insurance brokers are frequently called upon when someone is standing at the pharmacy counter and wondering why their prescription is no longer covered. And, we are the ones who sit in lengthy meetings with insurance carriers, reviewing power point presentations, as they reiterate why costs are rising, once again, for our clients.

For an honest and accurate discussion about the future of health insurance, our elected officials and political candidates need to rely, in large part, upon health insurance professionals for the creation of meaningful solutions. We cringe at the thought of our next President assuming office with the misperception that his or her health insurance solution “won,” and, more importantly, that this country can actually afford to implement such proposals.

To that end, organizations such as the New Jersey Association of Health Underwriters need to have a seat at the table to ensure our policy makers have the proper perspective and to ensure that no American is without access to quality health care simply due to cost avoidance.

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