Industry Outlook 2005
Almost 3 million Floridians under age 65 do not have health insurance. The state is hoping to ease the problem this year as the 2004 Affordable Healthcare for Floridians Act goes into effect. One component involves rolling out health savings accounts (HSAs), which combine a savings account with a high-deductible health insurance policy. The idea is that the high-deductible policy will be less costly for both employers and employees, while the savings account provides tax benefits.
Also on the state's fast track is a high-risk insurance pool for Floridians with severe medical problems such as Lou Gehrig's disease and brain and spinal injuries. "It's supposed to be a safety net in the purest form," says Karen Bender, an actuary with Mercer Oliver Wyman who presented her finding to the board of the state-sponsored group on the issue. Floridians unable to obtain medical insurance would pay anywhere from one and a half to three times the price of a standard premium.
A stumbling block for healthcare is the spiraling cost of Medicaid, the state-federal program that primarily serves low-income children and senior citizens. Gov. Jeb Bush is expected to push for reform. Medicaid will cost Florida about $14 billion this fiscal year and is projected to almost quadruple to $52 billion in 2015 if nothing is done. "The cost is not sustainable," says Jerry Senne, president and CEO of Health First Health Plans in Brevard County and chairman of the Florida Association of Health Plans.
2005 Forecast: What healthcare issues will be worth watching in 2005? "The biggest one is healthcare inflation and then the price of medicine and malpractice insurance," says Jerry Senne, chairman of the Florida Association of Health Plans. Senne sees "continued healthcare inflation at a lower rate than 2004, which was approximately 11%, but at double the overall rate of inflation."