Cost Containment through Benefit Plan Design

Abstract

The cost of health care is far outpacing the general rate of inflation and already has reached unacceptable levels. The $69 billion spent for health care in 1970 increased to almost twice that amount in 1976 and is projected by the Department of Health, Education, and Welfare to exceed $240 billion by 1982. Health care expenditures in 1976 represented 8.6 percent of gross national product. This was up from 5.9 percent in 1967 and, left unchecked, will exceed 10 percent by 1982. These unhealthy rates of health care cost inflation translate into ever-increased health insurance premiums to employer and employee alike, and to higher taxes and consumer out-of-pocket payments. Inexorably, year after year, each citizen is being forced to allocate more and more of his or her income for questionable added health care value.