Companies Protest MC Premium Hikes

US corporations and managed care organizations are bargaining thissummer to determine if health care costs will rise more than in the past few years, notes a report from Reuters.

It quotes a Wall Street Journal article as saying that several large corporations are refusing to pay insurers and managed care firms premiums which are up to 25% higher than last year. The Pacific Business Group on Health, a consortium composed of Chevron, BankAmerica, Safeway, Stanford University and others, has negotiated a 1% premium rise for 1998.

HMOs "Must Raise Their Prices By At Least 5%" Industry analysts are predicting 6%-10% rises in premiums for 1998. Health care providers argue that they need to raise premiums to cover their own growing expenses, which include higher drug prices and an aging workforce. Kenneth Abramowitz, an analyst with Sanford C Bernstein & Co, says: "it must be very clear to everybody that health maintenance organizations have to raise prices at least 5% or they are in big trouble."