NU Online News Service, July 10, 2003, 5:27 p.m. EDT – One-quarter of California employers say they may have to depend more on temporary workers, part-time workers and other workers without health benefits to cope with rising health insurance costs, according to the California HealthCare Foundation, Oakland, Calif.
Researchers at Harris Interactive Inc., Rochester, N.Y., surveyed California employers for the foundation and found that 62% plan to increase employee premium contributions for dependent coverage. Fifty-four percent plan to increase employee premium contributions for employee coverage.
Fewer than 10% of the employers surveyed plan to drop coverage altogether, but, in addition to the 25% who may make heavier use of workers without health benefits, 28% plan to reduce the scope of coverage, the foundation says.
“When health insurance premiums began to climb in the late 1990s, the tight labor market prevented employers from cost-shifting to their employees,” says Jill Yegian, a foundation official.
Now that unemployment is up and corporate profits are down, employers are starting to shift a greater share of the costs to employees, Yegian says.
But the foundation found that employers have mixed feelings about the effects of cost-sharing.
Employers say increased cost-sharing will make employees more savvy health care consumers, but employers also worry that the changes will reduce use of necessary care and hurt employees with chronic conditions.