Boeing, a company best known for the airplanes it makes, is about to raise the cost of the health insurance plans that it offers to it’s employees. Recently, 3M decided to cease offering a health insurance plan to it’s former employees who are retired. While 3M has claimed that it made this change in response to the recent changes in health care reform, Boeing says that the changes it is about to make were necessary, even without considering the new regulations in health care reform.
Employees of Boeing who are not part of a union will be paying more for health insurance. This includes employees who are managers. These employees can expect to be paying much more for the health insurance that they get from Boeing in 2011 than they were paying for it this year. Employees who are getting health insurance from Boeing that covers only themselves will be paying anywhere from $200 to $300 more next year. If the health insurance is to cover both the employee and the employee’s family, then they can expect the price increase to be somewhere between $600 and $900 in 2011.
Another change in cost has to do with co-insurance. Right now, Boeing pays for 100% of most of the health services for their employees who have purchased health insurance from Boeing. Next year, in 2011, Boeing is instead going to pay for 90% and expect the employees to come up with the money for 10% of the cost of services. Another change will come in 2012, when Boeing will pay for 80% and expect it’s employees to pay for the remaining 20%. Boeing is making these changes so that it can avoid hitting a threshold in 2018 that would cause them to pay a 40% excise tax on the value of all of their health plans that are over a certain amount.
Boeing has noticed that around 40% of the costs it pays for health care comes from health problems that are avoidable. These problems stem from smoking, from making unhealthy choices in diet, and from a lack of exercise. As a means of combating some of these costs, Boeing had been offering $50.00 gift cards to it’s employees who go and get their annual medical exams.
There are good things and bad things about this news. On the one hand, it may make the cost of health insurance too expensive for some of it’s employees to be able to afford in the next few years. I find it troubling when I hear about another company that intends to raise the costs of the health insurance that it offers to it’s employees at a time when most of the people who have health insurance are getting it from their employer. On the other hand, at least Boeing is continuing to offer health insurance to it’s employees, even if the price will be higher.
Image by Henrique Pinto on Flickr