The soaring costs of employee healthcare have been a growing drain on the bottom lines of plenty of companies and many are responding by cutting back on benefits or pushing more of the costs onto employees' shoulders.

Michael Moore's documentary Sicko has been drawing audiences to theaters this summer with tales of healthcare nightmares experienced by people who have health insurance, but who had to fight with their insurance companies to get them to pay the bills. Moore compares the situation in the United States with countries around the world that have national health systems, including our neighbor to the north, Canada. Watching their citizens' experiences with getting free healthcare makes one more than a tad envious.

Accountants naturally have been tallying the costs. In a recent survey of financial executives, including CPAs, controllers and CFOs, by the American Institute of CPAs, 99 percent of them said they are concerned about rising employee healthcare costs. Eighty-one percent said their employee healthcare costs had risen in the past year, from 5 percent to more than 20 percent.

The solutions are worrisome to employees around the country, many of whom find themselves paying more out of pocket for deductibles, co-payments and the like while getting a bigger slice of the healthcare premium taken out of their paychecks. In search of lower medical expenses, companies are changing their insurance providers, switching to high-deductible plans and reducing company contributions.

It's not surprising why companies are moving in this direction. Premiums for employer-sponsored health plans increased by 7.7 percent on average last year, according to the Kaiser Family Foundation. Workers paid $259 more in 2006 than they did in 2005 toward the cost of family health coverage. Workers at small companies were paying even more than at large companies, $3,550 compared to $2,658 per year for family coverage. Many more companies are avoiding even offering coverage to workers. Whereas 69 percent of companies offered coverage in 2000, the proportion fell to 61 percent in 2006.

The Presidential candidates have been unveiling a variety of healthcare proposals, especially for how they plan to cover the uninsured. But for many Americans, the problem is increasingly becoming one of how to fully cover those who are insured. Accountants will have to be part of the solution, if there is one. Still, the obstacles are formidable. Nobody in the end wants to be the one stuck with the bill.


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