Is Self-Insuring for Health Care Appropriate for Your Company?|
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I’m Doug Hawthorne, president and CEO of Texas Health Resources, with “The Business of Health Care Report.”
As we’ve said before on this program, Texas leads the nation in the percentage of people who do not have health insurance. According to a 2005 survey sponsored by the Kaiser Family Foundation, the percentage of firms offering health benefits has fallen significantly from 69 percent to 60 percent over the last five years.
In 2003, a similar Kaiser Foundation survey determined that 52 percent of employees who do have health insurance are covered by a plan that is completely or partially self-insured. According to The Wall Street Journal Center for Entrepreneurs, industry consultants say self-insurance is an increasingly popular alternative.
Employers that are self-insured pay employees’ health care claims directly and purchase special insurance to cover catastrophic cases.
Academy Health, an initiative of The Robert Wood Johnson Foundation, found that many employers turn to self-insurance to avoid conflicts in insurance laws across state boundaries, not as a way to avoid providing rich benefits, as some critics have claimed. The researchers found that both self-insured plans and conventional plans have similar costs and provide roughly the same benefits.
Does it make sense for your business to consider self-insuring? There is no simple answer. However, I do know that business and health care leaders working together can and must find cost-effective ways to provide access to health care for employees.
For Texas Health Resources and its faith-based hospitals – Harris Methodist, Presbyterian and Arlington Memorial – I’m Doug Hawthorne.