Health Care Costs

It is unbelievable, how employee healthcare cost has escalated over the past 5 years for the apartment industry. For a small to medium size apartment operating company note the actual premium comparison below:

Think about it … with continued increases like this with the individual plan, the property in 5 years will be burdened with the equivalent of carrying an an additional maintenance person on the property staff; and the family plan cost increase will be comparable to adding an Area Manager salary cost to the staff of the typical 250 deal in most of today’s apartment markets.

Most would say … it is because of Obamacare. And it is quite possible there is a significant amount of blame that is due Obamacare coupled with such a poorly crafted plan by the Executive and Legislative branches of our government. Both branches of our Federal Government get a big “F” for their work on this plan. Some recent changes also highlight the absurdity of recent developments; Note the IRS penalty highlights below:

Another thought process might be to think about the affordability of these plans for the employee. Most apartment operators, pays around 75% of the individual plan cost. Let us do a comparison of how affordable health care might be for the employee making $20 per hour as individual and as an employee buying family coverage:

* Calculation >>> $590 x .75% x 12= $5,310 Employer Paid Premium Credit + $18,540 Annual Family Premium

One can see that the individual plan premium for the employee is workable; but, the family premium is a disaster. Even if a plan were designed to have a total credit for the individual premium cost to be applied to the family premium, the percentage of annual compensation would still be 35%. Or if, you went through the same math process; but, your Family premium were only $1,250 per month rather than the $1,545 premium with the same family deductible the percent of annual compensation would drop to 26 %.

OH yes, Obamacare and our misguided Executive and Legislative Branches have done their share to impact cost; but, what about the insurance companies, doctors, and hospitals. Do you think there is any greed in this group? It is interesting to reference the 2nd Quarter Earnings Release for United Health Care. You will note from the following chart that revenue is up 28 % in comparing Same Store Growth and Net Earnings are up 11.9%.

Well suffice it to say there is enough blame to go around to all. If healthcare costs are not contained, rising cost will significantly impact operating results and the recruitment / retention of great apartment associates. We now hear that United Healthcare and Aetna will be significantly reducing their participation in the Healthcare State Exchanges. Most consumers will say that the system is broken.

The apartment industry needs an advocate that has a keen understanding of the apartment industry and healthcare cost. Acentria Insurance and Hamilton MultiHousing Advisors have their hands on the pulse of the apartment industry and seek the opportunity to serve the Apartment Operator.

Take a look at my website and check us out, you will see that:

When it comes to SOLUTIONS,

There is NO substitute for EXPERIENCE!

Contact Bill Hamilton at 678 640 3194

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