It’s the most wonderful time of the year for our small business: healthcare shopping time! TS Designs is looking at yet another health insurance rate increase this year. The private sector healthcare system is not working for us.
Ever since Tom and I started the company we have offered our employees healthcare. We pay for 50% of the individual’s cost and as the years have gone by and rates have increased so have the number of employees who have had to drop out.
We’re getting squeezed from a couple directions. First, we are a very small group; less than 20 people compared to the 100+ employees we had before NAFTA. Second, we are an older group with some serious pre-existing conditions – even a COBRA ex-employee that has health issues in the family is hurting our rate. It looks like we will be staying with Blue Cross & Blue Shield North Carolina, the largest in our state.
BCBSNC is a nonprofit healthcare company but is making so much money on their plans they paid their CEO, Bob Greczyn, almost $4 million last year, a $750,000 raise from the year before. They are planning an 11% rate increase this year. Why not give that excess back to their customers?
I would have no problem with his compensation if this were a competitive market, but in the US healthcare is not competitive. We need to remove the exemption from anti-trust laws the healthcare companies enjoy. Traditional market competition ideals do not apply to an industry that bases its decisions on risk pooling. In our system, the goal of profit-driven healthcare companies is not to provide healthcare, but to deny as many claims as possible to maximize profit. As economist Paul Krugman wrote, “The most successful companies are those that do the best job of denying coverage to those who need it most.”
Unless something is done, healthcare at TS Designs, and thousands of other small businesses, will become a casualty. And we’ll all share in those losses since the health issues will not go away. The number of uninsured will rise, bankruptcies due to healthcare will increase, and healthcare costs themselves will continue to creep higher and higher.
We need a public option to bring competition to the healthcare industry. The healthcare industry and their lobbyists clearly have the bucks to compete with it.