Rights Bill Needed to Contain Costs

Presently, there is a national rush to enroll citizens in managed care programs. People with AIDS, according to Graham, face unsettling chances of being ground under. The executive director fears that progress attained on behalf of PWA's during the past ten years may soon be obliterated.

As care costs edge upward, even larger increases are predicted. As much as a four percent rise is expected within 1997, while cost increase estimates range between five and ten percent for 1998. Costs in 1996 rose only 2.5 on the average, according to mass surveys of employers with ten or more employees.

The reasons for the projected cost rises are multiple: a larger aging population, including middle-aged baby-boomers, costly new medical technology, and life-prolonging prices for drug combinations that now--outrangeously-- fleece AIDS patients at $12,000 per year.

Other factors signal higher costs, including national and state government prohibitions limiting hospital stays after childbirth. Insurance companies, as a result, will charge higher premiums. With the budget-conscious Federal government compressing Medicare payments to HMO's and to doctors and hospitals, those private employers who offer health benefits will be especially hard hit.

Annual premiums paid by both employers and employees rose steadily between 1994 and 1996, jumping $80 in 1995 and $94 in 1996, according to the Foster Higgins benefits consulting firm. The U.S. Department of Labor estimated last year's health cost rises at 3 percent, although the overall Consumer Price Index was up 3.3%.

Aetna, Inc., among the largest health insurers, has announced that its 1997 premiums are between 3 and 6 percent higher than in 1996, while fee-for-service insurance has jumped up to10%. Aetna premiums had remained flat throughout 1996.

Foster Higgins' chief analyst, John Erb, believes that with the confluence of expected inflationary tendencies and with changes in Medicare, 1998 may see "double diget health care inflation." Rob Fowler, executive director of the Council of Smaller Enterprises, says that everything he hears leads him to believe that price increases are headed toward inflationary double-digets.

A variety of business watchdogs foresee health care providers and insurers continuing to ask greater amounts from small businesses who contract them. Some companies have begun to require long-term contracts in order to assure themselves that premiums remain relatively stable. Many larger corporations, however, change insurers with greater regularity.

Managed care, according to Rob Fowler, may have "squeezed out" all that could be expected of it. Other cost experts are launching complaints against the news media and growing hosts of TV ads promoting drug companies and hospitals. Such advertising, telling consumers to make use of current health care offers not only adds to cost increases, but greater usage by consumers also contributes to the rise.

Insurance companies, insists a prominent academic researcher, Professor Altman of Brandeis University, commonly overestimate their own abilities to contain expenses. For two or more years they lose money; then they raise their premiums to make up the difference.

"They act as if driving a car can be best accomplished by keeping one's eyes on the rearview mirror," one insurance company critic complains.