Employees at the Indiana University can expect to start paying more for their health insurance next year. According to Neil Theobald, vice presidents and chief financial officer of the university, the school is unable to keep up with the pace at which insurance rates are being increased. The university is unwilling to cut health care benefits for its staff, so has introduced a new initiative that has earned some controversy. Next year, the cost of health insurance for university employees will be based upon how much they earn, as well as what policies they have.
The highest earning employees will see the largest premium increase – an average of 21%. Lower income employees will see modest rate increases, while those participating in high deductible insurance policies will see none. University officials note that this plan may not be the best news for employees, but is a necessary evil in order for the school to continue offering health care benefits.
Health insurers have been raising rates for coverage recently due to soaring medical costs. Advanced surgical procedures and new medical technologies have pushed up the cost of care. It has proven difficult for insurers to keep up with the pace of rising costs, leading them to propose steep rate hikes. The practice has been the source of public ire for the better part of this year, leading insurers to begin pressuring federal lawmakers to take moves on curbing excessive inflation.
Thus far, federal legislators have yet to tackle the issue, leaving insurers and their clients with little to no alternatives.