Vast Majority of Large Employers Surveyed Say Broader Government Role Will Be Necessary to Control Health Costs and Provide Coverage, Survey Finds
Most Business Leaders Favor Increased Anti-Trust Enforcement, Prohibitions on Anti-Competitive Practices, Capping Drug and Hospital Prices in Non-Competitive Markets; A Public Option and Lower Medicare Eligibility Age Seen as Viable Options
Top executives at nearly 90% of large employers surveyed believe the cost of providing health benefits to employees will become unsustainable in the next five-to-10 years, and 85% expect the government will be required to intervene to provide coverage and contain costs, according to a new survey released today from Purchaser Business Group on Health (PBGH) and KFF (Kaiser Family Foundation), with support from the West Health Institute.
The research exposes large employers’ mounting concerns about the future of employer-sponsored coverage, with 87% of respondents saying they believe that the cost of providing health benefits to employees will become unsustainable in the next five to 10 years.
More than 300 executive decisionmakers at companies with over 5,000 employees responded to the survey in December 2020 and January 2021. The survey report was released today in advance of a web briefing jointly held by PBGH and KFF examining the views of business leaders on health policy.
“This survey highlights what we’ve understood for some time: The current health care system is on an unsustainable path,” said Elizabeth Mitchell, President and Chief Executive Officer of PBGH. “Our large employer members support competition and prefer market solutions. But they have reached their limit; they’re tired of pouring tons of money into a broken health care market that delivers uneven quality at bloated costs.”
Annual family premiums for employer-sponsored health insurance reached $21,342 in 2020, up 55% since 2010 and increased at a rate at least twice that of both wages (27%) and inflation (19%). During the same period, the average single employee deductible increased from $917 to $1,644 among workers with a deductible.
Employer health plans are already paying much higher prices for health care goods and services than public plans: Hospitals across the country charge employers and private insurance companies an average of 2.5 times what they get from Medicare for the same care, and three or more times Medicare prices in a half-dozen states.
“Any efforts to expand public coverage options or restrain prices will be met with strong opposition from the health care industry,” said Larry Levitt, Executive Vice President for Health Policy at KFF and an author of the report. “Employers, who foot much of the nation’s health care bill, could be a powerful counterweight.”
“Skyrocketing health care costs pose a significant threat to the prosperity of business and American workers. Every extra dollar spent on health care is one less dollar available for wages, investments and other essential business expenses,” said Shelley Lyford, President and Chief Executive Officer for West Health. “Employers are getting a raw deal and they need to leverage their collective power in Washington to inspire action from lawmakers – particularly at a time when the economy is reeling from a pandemic.”