Rising health care costs are one of the biggest challenges manufacturers and their employees face. According to a 2006 survey of small- and medium-sized manufacturers conducted by the National Association of Manufacturers (NAM, Washington, DC), 87 percent of respondents ranked escalating health care costs as their most pressing problem. In addition, approximately 10 percent of small- and medium-sized manufacturers spent an average of 27 percent of sales on health care expenses.
In fact, the United States tops other countries in terms of health care spending as a percent of gross domestic product.
Total Spending on Health Care as a Percentage of GDP
Percentage point increase
As a result of these rising costs, 69 percent of respondents to the NAM survey said they had to raise their employees’ share of coverage, while 28 percent said that they would begin or increase Health Savings Accounts.
While the United States leads the world in advanced medical technology and services, escalating spending on health care is taking a toll on employers. The burden of footing this bill is making U.S. manufacturers less competitive and provides a considerable incentive for moving manufacturing jobs to low-cost labor markets.
Since this is an election year, it would be wise for everyone to see where the three remaining presidential candidates stand on healthcare.
Among other things, Republican candidate Sen. John McCain would:
* Give states the flexibility to experiment with: alternative forms of access; risk-adjusted payments per episode covered under Medicaid; use of private insurance in Medicaid; alternative insurance policies and insurance providers; and, different licensing schemes for medical providers.
* Pass tort reform to eliminate frivolous lawsuits and excessive damage awards.
* Reform the tax code to eliminate the bias toward employer-sponsored health insurance, and provide all individuals with a $2,500 tax credit ($5,000 for families) to increase incentives for insurance coverage. Individuals owning innovative multiyear policies that cost less than the full credit can deposit remainder in expanded health savings accounts.
To learn more about McCain’s health care plan, clickhere.
Among other things, Democratic candidate Sen. Barack Obama would:
* establish a new public insurance program, available to Americans who neither qualify for Medicaid nor have access to insurance through their employers, as well as to small businesses that want to offer insurance to their employees.
* create a National Health Insurance Exchange to help Americans and businesses that want to purchase private health insurance directly.
* require all employers to contribute towards health coverage for their employees or towards the cost of the public plan.
To read more about Obama’s health care plan, clickhere.
Among other things, Democratic candidate Sen. Hillary Clinton would:
* give businesses, employees and the uninsured the option of buying group insurance through a new Health Choices Menu. This menu will offer the same set of insurance options that members of Congress have. In addition, the menu would include a public plan option, modeled on Medicare.
* provide a tax credit to ensure that health insurance premiums never rise above a certain percentage of family income.
* require large employers to provide health insurance to their employees or make some contribution to the cost of coverage. Small- and medium-sized businesses would get a tax credit for providing health insurance.
To read more about Clinton’s health care plan, clickhere.