health072606
Medical premium growth is slowing
The growth in insurance premiums moderated last year in Minnesota as some expenses were shifted to the consumer. The slower growth may help smaller employers.
Print this story
E-mail this story
Save to del.icio.us
Share on newsvine
Share on Digg
Minnesota business by the numbers
See Minnesota's top earning companies, CEOs and non-profits
More from Business
In 2005, private health insurance premiums for Minnesotans grew at the lowest rate in the last eight years. But consumers picked up more of the tab in out-of-pocket expenses.
Premiums grew 4.5 percent on average last year, down from 11.2 percent in 2004, according to an annual report released Tuesday by the Minnesota Department of Health.
The department said the slowdown should help stem the decline in those covered by private plans as insurance became prohibitively expensive for smaller employers. Between 2001 and 2004, the percentage of Minnesotans covered by employer-based insurance dropped from 68.4 percent to 62.9 percent.
"We still have to keep working to make sure that all Minnesotans have access to affordable health care," Health Commissioner Dianne Mandernach said.
The 2005 figures also show the effect of so-called consumer-driven health plans, in which employers attempt to shift some costs to employees in the form of larger deductibles and copayments.
Individual out-of-pocket expenses grew 13 percent last year, from $433 to $489 per enrollee. Out-of-pocket costs made up 13 percent of total health care spending, including health plan costs, up from 10 percent in 2000.
The report found that growth in spending per enrollee slowed in 2005, to 6.8 percent from 7.4 percent in 2004. The report said the largest declines in medical spending were for prescription drugs and physician services.
"What we're seeing, after years of steep increases in health insurance, is a leveling off, even a decline, which is the result of efforts by insurers and providers to take costs out of the system," said Julie Brunner, executive director of the Minnesota Council of Health Plans. "This is really good news for the purchaser and the consumer."
David Phelps • 612-673-7269
- Minnesota Senate recount: Take the Coleman-Franken Ballot Challenge
- Our Hungry Planet: The ever-shrinking box and carton
- Capacity, job cuts coming to Delta, NWA
- Chrysler Nov. US sales drop 47 pct; GM down 41 pct
- Tom Petters is indicted on 20 counts
- U.S. Bank poised to grow bigger, stronger
- Attorney: Petters will plead not guilty
- GM, Ford CEOs taking company cars to Washington
Blog: Patent Pending
Give a lot, take a lot
In times of economic anxiety, there is a natural tendency to cut back and pull back. One has to do with economics, the other concerns attitude. Faced with slumping sales and declining stock prices, companies will naturally cut spending, a short term impulse that undermines long term thinking. People who have lost jobs or fear [...]
Comment on this story | Read all 0 comments | Hide reader comments