EDITORIAL: Health savings is big

Aug. 29--It's remarkable, and worth applauding, that Missouri Western State University was able to hold its annual health insurance cost increase to just 0.87 percent, or $17,400.

The university this past week renewed its agreement with Blue Cross Blue Shield of Kansas City. Some employees will see a decrease in their costs; others will see an increase of up to $12 per month, depending on their plan.

Chief budgeter Dr. Cale Fessler, vice president for financial planning and administration, has had experience with these things. He pays attention to the news and knows where health care costs are headed. He had budgeted for a 10 percent increase that would have cost about $200,000.

Pressed for an explanation of how the university fared so well in negotiations with the big insurer, Dr. Fessler pointed to employees' good track record for keeping utilization of expensive medical services in check. He also noted the university had other places it could turn to for its health care coverage.

The university should hope that competitive situation persists into next year, when Missouri Western will conduct a formal bidding process for its insurance, something that is required by the state at least every six years.

No employee group likes to go through the process of changing insurers and the network of doctors, but likewise no one looks forward to the kind of health care inflation the experts are predicting.

The consulting firm PricewaterhouseCooper projects health care costs will rise 6.5 percent this year and 6.8 percent next year, in part reflecting higher utilization of services by people who delayed medical care during the recession. This upward trend is notable, suggesting a possible return to pre-recession annual increases that routinely exceeded 10 percent.

The consultants say most health plans try to avoid increases for the full amount of health care inflation. Instead, they typically shift some of the cost increase to covered employees, such as through higher deductibles and co-pays, and occasionally will limit the network of providers.

In a related development, The New York Times reports nearly half of all employers are considering shifting all of their workers onto high-deductible plans within the next three years, which would compel the workers to pay more attention to pricing when they seek care.

Missouri Western says its deal will result in no changes to deductibles, co-pays, out-of-pocket maximums or other benefits. That's very good news for the employees and their families, but cautious health care economists might counsel to enjoy this while it lasts.

___

(c)2015 the St. Joseph News-Press (St. Joseph, Mo.)

Visit the St. Joseph News-Press (St. Joseph, Mo.) at www.newspressnow.com/index.html

Distributed by Tribune Content Agency, LLC.