Health Insurance Faces Uncertain Future

Area health insurance experts are not sure where their industry is headed in the next few years. But one thing is certain: Something has to change.



"If things keep progressing the way they are today, we're in big trouble, said Sam Lombardo, president and chief executive officer of The Benecon Group in Leola, Lancaster County. The independent insurance agency serves both public and private-sector employers that range in size from two to 5,000 workers.



As health-care costs continue to rise, more companies are cutting employee benefits. The effect has been more out-of-pocket expenses for workers.



On average, U.S. employer-sponsored health insurance premiums increased by about 11.2 percent in 2004. It was the fourth consecutive year of double-digit growth, according to the 2004 Employer Health Benefits Survey by the Kaiser Family Foundation and Health Research & Educational Trust.



Since 2001, employee contributions have increased 57 percent for single coverage and 49 percent for family coverage. Meanwhile, workers' wages have only increased 12 percent, said officials from the Health Systems Studies at the Health Research and Educational Trust.



The increasing costs have hit small-and midsize companies especially hard.



Karen H. Horan, is principal of Capital Benefits Group Inc. The company provides health insurance plans for 80 companies ranging in size from two to 300 employees. In recent years, she has had to tell her clients that their premiums were going up by between 20 percent and 60 percent.