My husband Mark and I had always wanted to be able to bring our dogs to work, and be in business for ourselves. We realized that goal in 1997, after saving hard from our day jobs. Our dog and cat “pet camps” have given us fulfilling and happy work. Dogs having an outdoor play party are the definition of joy.
Dealing with small business health insurance, however, is the exact opposite experience.
When we first bought our small-business health policy in 2000, it cost about $30,000 a year for a very good policy, for our family and about 12 employees. It was affordable, if not cheap, and we felt responsible for our staff. There was no employee cost share on the premium, and only small co-pays. (If we’d stayed on that original plan, it would cost $180,000 by now.)
By 2010, our employees were paying 10% of the premium for less coverage in the three plans we were able to offer. The cost was still triple the 2000 price at about $90,000. We were right at the edge of what we could pay in a down economy.
Then, last summer, the hammer fell. We got notice of a $27,000 premium increase—more than 30% in one year– even though our staff skews younger and relatively healthy.
We absolutely couldn’t pay $117,000. Even in good times that amount would be crushing, and for the last few years business has been slower. People who travel less for business, take fewer vacations and don’t do big home remodels also don’t board their pets as much. But the economic slump obviously doesn’t extend to the insurance industry.
We scrambled for alternatives. First we gave up offering three health plan choices through a private purchasing group. We had to put everyone, including our triplets and son (he’s about to be 10), on a single Kaiser HMO policy with a hefty 20% employee premium share and $50 copay for doctor visits. We still pay in full for vision and dental care.
The hardest part for me was having to give up our wonderful pediatrician and nurse, who cared for our children from birth.
The shift left us still paying $90,000 (all of us together pay this — us and the employees). Now we’re holding our breath for a likely premium increase from Kaiser July 1.
Small businesses pay more for less coverage than large businesses. If we have loyal employees who stay with us until they turn 50 or 60, insurers charge us $5,000 or $10,000 extra to cover them. It’s no wonder that fewer and fewer small businesses even offer health insurance. The system is broken, and only the insurance companies benefit.
We hope for some relief when the state small business purchasing Exchanges go into effect in 2014 under the federal health reform.
We also need the state on our side. What’s the justification for a 30% increase? Who’s even watching our backs?