High-deductible plans help with health insurance

OregonLive.com

Small business - Individuals and firms find some relief as insurers find ways to stabilize rates
Thursday, January 12, 2006

JENNIFER D. MEACHAM

For the self-insured like Eva Willingham, a Wilsonville dog groomer and owner of Eva's Doggery day care, health care insurance is "always too expensive."

But she's finding ways to mitigate costs with Regence BlueCross BlueShield, a carrier which this year is "stabilizing" its rates and upping her deductible to $5,000.

"I still have a $20 office visit co-pay, so if I have something small, I can easily go in without hardship," Willingham said. "And I have a really small IRA that I can pull the $5,000 out of if necessary."

High-deductible plans, rarely found above $2,500 in years past, are now readily available. They're also coming with perks that include $20 office visits, laboratory tests covered by the $20 co-pay, prescription coverage and deductibles waived for accidents.

This is also the second year for health savings accounts, structured like IRAs. Put money in now, get a high-deductible policy that's compliant with the account and forgo income taxes on any money spent on health care.

That's good news for the area's self-insured, who have seen health insurance costs increase from 12 percent to 22 percent from 2004 to 2005, according to an informal survey by the Beaverton-based Oregon Business Association.

"We're aware from our small members that it's a really crushing problem," said Carol Robinson, the association's director of development, "and probably one of the most significant expenses that small independent business people are facing right now."

Providers are taking steps to stop the bleeding.

Regence BlueCross BlueShield is stabilizing rates "at less than trend" in 2006, the first time in five-plus years of medical inflation running 14 percent to 17 percent each year. LifeWise lowered group rates for some in 2006.

Even the state is pitching in. On Jan. 1, the new Oregon Office of Private Health Partnerships launched with bare-bones insurance plans from two companies -- Regence BlueCross BlueShield and Tigard-based Health Net Health Plan of Oregon. So far, 13 employers statewide have signed up, covering insurance for 53 people.

Deductibles are $1,000 for adults and $500 for children. The cost? Twenty percent to 30 percent below general market, expected to drop further in March. The employer pays the first $50.

Until now, Oregon had mandated that all small-business plans cover mental health and some women's and men's health issues, among other requirements. The new plans eliminate some requirements to help shave costs.

"If the state's starting to offer these programs, then maybe it's opening up for all the insurance companies," said John Gridley, president of eHealthLink.com, an agency with self-insured and self-employed clients throughout Southwest Portland.

Meanwhile, membership in some business associations comes with group health insurance rates through online insurers such as eHealthInsurance.com. Associations such as the National Federation of Independent Business/Oregon Chapter and the Oregon Association of Realtors may soon be able to offer self-funded insurance to members, but that's still awaiting congressional support.

"Oregon is definitely not one of the cheaper places to buy insurance, so if this (legislation) passes, you better believe we would start a self-funded program or go through a carrier," said J.L. Wilson, NFIB Oregon state director. "One thing that is sure is that members would start seeing a decrease in their premiums."