When Darrell McNair, president and CEO of MVP Plastics Inc., went to renew the company's healthcare plan for 2016, he learned that the renewal rate for an unchanged plan would mean an 11% increase.
He had his provider look into what it would be if he abandoned the plan and went to the Affordable Care Act marketplace. McNair learned that the best deal would still increase his premium, as well as the co-pays and deductibles for employees.
He decided to stick with his original plan, because he didn't think the alternative was good for workers.
“I don't like it,” McNair said. “It unfairly burdens employers and employees.”
It's a familiar story for business owners, who have been struggling to keep up with rising health insurance costs. And manufacturers in particular point to those increases as a concern.
The most recent outlook survey from the National Association of Manufacturers listed rising healthcare-related costs as the second-largest “primary” business challenge, behind only unfavorable business conditions. But local companies say offering health insurance and other benefits gives them a competitive advantage when it comes to retaining employees, so it's a challenge they have to tackle.
The rising cost of healthcare has led companies to try a few different tactics, said Steve Ligus, vice president of employee benefits at insurance brokerage Hylant Group Inc. in Independence.
Some have increased limits, while others have started offering more choices of plans for employees. While there was fear that companies would stop offering insurance, that hasn't borne out.
Companies have been moving toward a model where employees act more like consumers when they go to the doctor, instead of just going ahead and getting a lot of tests done, said benefits consultant Dan Bilek of Solon-based human capital management firm CPI-HR. Northeast Ohio was a pretty early adopter of some of the alternative plans, including health savings accounts, or HSAs, he said.