By Paul Breslau, Breslau Insurance & Benefits Inc.
There are 7,000,000 people in our great state. In Arizona for health insurance we have the Affordable Care Act, Medicare, and Medicaid which we call AHCCCS as well as private insurance and those with no health insurance.
Recent reports show 1,900,000 Arizonans on all forms of AHCCCS, the state run Medicaid program. There are 1,180,000 Arizonians on Medicare, the federal program for those age 65+ and disabled people. Another 200,000 Arizona individuals are on an Affordable Care Act plan, many with federal premium subsidies. This totals 3,280,000 or 47% of us in direct government related plans. This does not count additional government plans such as Veterans Affairs (VA) Benefits or Bureau of Indian Affairs (BIA) health insurance which likely puts the total over 50%.
The remaining plus or minus 3,700,000 of us are accounted for as follows. Approximately 10% or 700,000 have no health insurance. This leaves about 3,000,000 on employment based health insurance provided by businesses as well as city, state, and other governmental employer entities. There are also a dwindling number of individuals and families on Grandfathered health plans.
Scottsdale Airpark
The Scottsdale Airpark is primarily a business zone and includes many on private employment based health insurance. According to reports by Jim Keeley, SIOR, CCIM, founding partner of Colliers International Scottsdale there are over 3,000 businesses employing nearly 60,000 workers in the Airpark.
These businesses cover their employees in private plans offered by BlueCross, UnitedHealthcare, CIGNA, Aetna, and many others including Redirect Health in the Airpark. The largest employers are fully self-funded and hire third-party administrators to pay their claims. As mentioned in last month’s article more smaller and mid-sized businesses are using partially self-funded plans, also known as level funded plans, to gain control of their health insurance expenses. The smallest of businesses are using plans that are regulated by the Affordable Care Act. This last category is the next up to be most threatened in my opinion.
According to the 2017 Employer Health Benefits Survey by the Kaiser Family Foundation “In 2017, the average annual premiums for employer-sponsored health insurance are $6,690 for single coverage and $18,764 for family coverage”. Assuming the Airpark is average and the 60,000 workers are single the premium total an astounding $401,400,000. One can understand how the 2016 revenue of HonorHealth was $1,716,544,000 according to their Consolidated Statement of Operations by Ernst & Young LLP, since they service a much wider area.
Conclusion
Health care, health insurance, and employee benefits are a big deal for Arizona and those of us in the Airpark. The amount of dollars devoted to our health is extremely large. These numbers grow more than inflation year after year and decade after decade. The challenge to arrange and pay for health insurance and benefits requires governments and businesses to devote much time and energy. Professional health insurance agents such as me are strained to keep up with serving clients.
In my opinion 2019 may double down on the impact to employers due to persistent rate increases and turmoil from Affordable Care Act changes, whatever they may be. Again, all Airpark employers should start reviewing alternatives earlier than your renewal time.
Many of the above numbers are rounded and estimated yet mostly on the mark for the big picture. I encourage fact checkers to let me know if anything deviates too greatly. Also, as always, your comments and questions are welcome.
Paul Breslau, Registered Health Underwriter (RHU), Registered Employee Benefit Consultant (REBC), Chartered Life Underwriter (CLU), Chartered Financial Consultant (ChFC), Chartered Advisor for Senior Living (CASL), is President of Breslau Insurance & Benefits Inc. Contact: 602-692-6832; www.HRaz.com; Paul@HRaz.com.