What began as a slight uptick in health-care premiums three years ago has become a trend that has no real end in sight.
Employers, who pay for much of the health-care insurance in this country, are seeing health-care costs go up anywhere between 10 and 20 percent, and some small employers are getting premium increases that are even higher.
Most Minnesota companies, however, are keeping health insurance as part of their benefits packages. In a tight labor market, they can't afford to drop coverage because health insurance is an option that most workers insist on as a condition of employment.
A survey of Minnesotans conducted earlier this year by the University of Minnesota found that 70 percent get health insurance through their job, up from 65 percent in 1990.
But employees are feeling the effects of the cost increases. Most are paying higher premiums or are being asked to make higher copayments at the doctor's office or pharmacy counter.
High health-care costs also affect employees indirectly through lower wage increases, or lost job and career opportunities caused by a lack of capital.
"In order to pay for health care, [companies] are adjusting their starting wages, delaying expansion plans and adjusting employment levels," said Bill Blazar, senior vice president at the Minnesota Chamber of Commerce.
Of the companies the chamber surveyed this year, 63 percent said they have reduced other expenses to compensate for health-care costs, with 40 percent saying they've given smaller salary increases. And 36 percent said they've raised prices to cover health-care expenses.
Dennis Jindra, owner of Kirscher Transport in Virginia, Minn., knows that his 24 percent increase in health-insurance premiums will mean that there's less money available to run his business.
"This is certainly not going to help me buy any new equipment," said Jindra, whose company provides specialized heavy-trucking services to the mining industry. He estimates that the added health-care expenses will cost $3,000 a month.
"I know that is small potatoes to a 3M or IBM, but to me that is two more tractors a month I could have," he said. "It is a significant amount of money for a small company."
He can't pass all of the costs on to his 32 workers because most are covered by a union contract that limits employee cost-sharing to 4 percent of the total premium. He said that even without that limitation, he'd be conservative in changing the benefit.
"You shouldn't have to take less coverage just to keep your employees insured," he said. "I believe in comprehensive coverage for my employees."
He wonders if this year's 24 percent increase will be repeated, or if it is a one-time event.
"In 13 years this is the highest increase I've ever seen," he said.
He's not the only one saying that.