The Effect of Employer-Sponsored Health Insurance on U.S. Medical Expenses: Zane Benefits Publishes New Data


Park City, UT (PRWEB) May 19, 2012

Today, Zane Benefits published data outlining the effect of employer-sponsored health insurance on overall U.S. medical expenditures over time. Zane Benefits provides small businesses with comprehensive and flexible alternatives to traditional group health insurance.

Originally, employers thought providing tax-free health benefits and paying all incidental medical expenses was a great way to compensate employees, with federal, state and city governments paying about half the bill through hidden tax subsidies. This subsidy was even larger for decision-making executives in high income tax brackets because the marginal federal personal income tax rate for people earning over $ 135,000/year ranged between 91% and 70% from 1959-1981. By the mid-1970s, employer-sponsored health benefits with virtually no deductibles were almost universal among major employers.

With third-party employers and government footing the consumers medical bill, the medical industry was given free rein to develop thousands of new treatments. Most of these were efficacious treatments, increasing the quality of healthcare across the country.

However, not all treatments were economical. For example, the pharmaceutical industry developed solutions to problems that werent previously defined as medical issues (e.g. prescription drugs to allow people to eat unhealthy foods, Mirapex to treat restless leg syndrome sleep disorders, Viagra and Levitra to treat impotence caused by old age, etc.). By classifying these solutions as prescription drugs rather than over-the-counter medicines, the industry was able to sell them to patients with other U.S. citizens and/or employers paying a large portion of the cost through the tax subsidy on employer-sponsored health insurance plans.

The sad truth today is that less than half of all medical care in the United States is supported by good evidence that it works, according to estimates cited by the Congressional Budget Office. -New York Times Editorial

LASIK provides an interesting Case Study

Of course, most of the thousands of medical solutions developed, such as MRIs, vaccinations, and surgical procedures, work well and greatly improve our medical care. But, because these solutions were also paid for through distant third-party employers, there was little incentive for medical providers to make these solutions more affordable. LASIK eye surgery, which is typically paid for by consumers themselves versus employers, came out in 1997 and competition forced the price from $ 3,500/eye to $ 500/eye for a greatly improved product. Meanwhile, the cost of MRIs and other technology-based innovations increased threefold over the same time period where the consumer did not have to pay their own bill.

Healthcare cost rose from $ 27 billion in 1960 to more than $ 2.3 trillion in 2007

As a result of these and other problems, U.S. healthcare costs, funded mostly through tax-free employer-sponsored health benefits, rose from $ 27 billion in 1960 (5% of GDP) to more than $ 2.3 trillion in 2007 (16% of GDP). Today the cost of employer-sponsored health benefits exceeds profits for many large companies and threatens the viability of major employers. For example, the market value of General Motors dropped 50 percent after the company announced a $ 60 billion retiree healthcare obligation (They’ve since switched to an HRA for many employees that reimburses retirees for medicare supplement premiums).

Due to rising costs, some employers and employees have been economically forced to abandon employer-sponsored health benefits entirely. Today, less than 50% of U.S. small businesses offer group health insurance.

Is Consumerism the Solution?

Many U.S. economists today agree that part of the solution to rising medical costs is returning the consumer to paying directly for part of their healthcare. To a degree, most employers have already embraced this concept by having employees pay the first few hundred or thousand dollars of their own medical caretypically by raising their annual deductible, increasing coinsurance, and shifting premium costs to employees for spouses and dependents.

Raising the employees annual deductible has proved difficult for employers to implement because:

Employees expect to receive virtually 100% coverage for medical expenses as part of the benefits of a good job;

Employees have not been financially educated to budget for medical expenses, and get angry at their employer (or carrier) when they incur non-covered medical expenses; and

Employees typically have to pay up to twice as much after tax for medical expenses and health insurance premiums not paid through a qualified employer-sponsored health plan, health savings account or cafeteria plan.

About Zane Benefits, Inc.

Zane Benefits, Inc, a software company, helps insurance brokers, accountants, and employers take advantage of new defined contribution health benefits and private exchanges via its proprietary SaaS online health benefits software. Zane Benefits does not sell insurance. Using Zanes platform, insurance professionals and accountants offer their clients a defined contribution plan with multiple individual health insurance options via a private health exchange of their choice. Learn more at http://www.zanebenefits.com.







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Mens Health Brand Gets Big Surprise

Durham, NC (PRWEB) September 11, 2012

A new study by Phoenix Healthcare, a division of Phoenix Marketing International, has found that half (47%) of men 45+ suffer from multiple mens health conditions known mostly by their acronyms ED, BPH, Low T and gout. This market of mixed morbidities is larger than any one of these conditions individually. With over 30 million men today (and growing by 14% in 2020 and 27% by 2030), it is no wonder pharmaceuticals are rapidly heating up competition for mens attention to learn about their conditions and their brands.

Seventeen (17) ED, BPH, gout, or Low T brands jumped up DTC advertising by 33% to over $ 400 million dollars. This represents very rare growth in DTC. To learn if that much money resulted in more men to talking to their doctors, Phoenix surveyed a large random sample of 1,500 men, 45+. And what they discovered was surprising.

Only 1 in 10 men (13%) who talked to their doctor about their mixed gout symptoms talked about their gout. This is in stark contrast to the 8 in 10 men (76%) with mixed gout symptoms who watched Takedas gout treatment ads or Ulorics green flask ads. Despite having gout symptoms, it was their symptoms for ED, Low T then BPH that won the largest shares of symptom discussion. Clearly, the battle for market growth is fueled by the competition for share-of-voice in the physicians office.

Phoenix Healthcare introduced the 360

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