Wall Street Journal Examines Cost Increases in Employer-Sponsored Family Health Benefits
The Wall Street Journal today looks at efforts by some companies to curb double-digit health care cost increases by "sharply" raising premium rates for employers' dependent health coverage, adopting incentives to encourage employees' spouses to leave their health plans and refusing to cover spouses who work for companies with similar health plans. For example, in a tentative contract settlement reached last week between Verizon Communications and its unions, employees whose spouses decline comparable health coverage at their own company must pay a $40 monthly fee. Boeing also charges employees' spouses an additional $100 per month if they decline their own employers' plan, while General Electric in January will start charging higher premiums for employees with larger families, a practice called "tiering" that has been adopted by several other companies. The Journal reports that the "tactics appear to be working." In a survey released today, the Kaiser Family Foundation and the Health Research and Educational Trust found that 33% of employees chose to take family coverage through their company this year, down from 39% in 2001. In addition, the percentage of companies that fully subsidize family health premiums decreased to 15% in 2003 from 27% in 2001, the survey found. Although some labor unions are fighting measures to limit dependant coverage, many have ceded to companies' cost-containment moves in order to preserve the most generous health benefits for employees (Fuhrmans, Wall Street Journal, 9/9).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.