Refocus on Health
Interestingly enough, many Insurance costs tend to increase each year. We thought it would be beneficial for you to understand what is considered when our carriers are determining our rates and why MMH has had to pass some of the increase on to you. It is not a decision that is made lightly, and the information below explains in detail some of the background that goes into that determination.
Each year the Insurance Carrier forecasts what carrying Insurance for us will cost them, based on some of the following information:
1) The total dollar amount paid by the Insurance Carrier on claims we incurred.
2) The total dollar amount paid by the Insurance Carrier on Prescriptions filled.
3) The dollar amount associated with on-going claims that are projected to carry over year-to-year.
Once that has been determined, the proposed rates must also take into account the new expenses attributed to applicable laws and increases in 3rd party administrative fees.
- 4-5% of premium increases over the last year were due to new taxes that are fixed as a result of the Affordable Care Act.
- 3-4% of premium increases can be attributed to new Mandated Care protocols, e.g. Preventive Measures, etc.
- 4-5% of premium increases are behind-the-scene costs incurred by the carrier due to third party increases for administrative fees.
Over the last two years, the cost for MMH Employee Only health insurance coverage has gone from $454.55 to $661.61. Of that, in order to help keep insurance benefits affordable for our employees, only $5.05 per month has been passed along to you. The other $202.01 per month has been absorbed by MMH. The following graph depicts the trend in annual hospital paid health insurance expenses (health, dental, and employee discount) over the last six fiscal years:
Did you know:
- Beginning October 1, 2013, MMH paid 86.43% of your employee only medical premium, while you the employee paid just 13.57% of that cost?
- Beginning October 1, 2014, MMH paid 87.95% of your employee only medical premium, while you the employee paid only 12.05% of that cost?
We have all experienced increases in our deductible amounts and decreases in the buy-down offered by the hospital. Without those changes to our plan, health insurance alone (not including dental or employee discounts) would have resulted in an annual expense of more than $5.1 million in 2015. Please be assured that great efforts were made to negotiate and to find creative ways to control costs while still providing affordable and comprehensive coverage for employees. Controlling our benefits costs is imperative if we are to maintain competitive pay, fund existing and new services, and ensure our future.