, assistant vice president of Aon Consulting , an employee benefits consulting group in Green Bay , blames competition among health-care providers and insurers for the leaps in premium costs the past two or three years.
There are a lot of players in the market , excess capacity and people looking for market share were artificially holding costs down , he
The players offered reduced rates to encourage companies to sign on with them , but lost money and couldn't maintain those low rates for long.
The carriers have control now , Morris
said.They say to the underwriters , ‘You are going to be profitable.'.
been delivering rate hikes of 25 to 62 percent for some of his
clients , with an average increase for fully-insured employers in 2002 in the upper 20 and 30 percent range.
In the past we saw employers not shifting costs but absorbing the increases because of the tight labor market , he
said.This year it's a different story.More employers are shifting costs either in plan design changes or employee contributions.
Conor Green , an Aon consultant , said that puts employers in a bind.
Employers want to provide what the other providers do , he