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Cut Healthcare Spending or Face the Public Option

By Christopher Cheney  
   August 22, 2016

"If we don't get a handle on spending at some point, we will have a government-financed system," predicts the head of the Pacific Business Group on Health.

With healthcare-spending growth continuing to outpace growth of the national economy, large employers are facing a gargantuan challenge.

"It's challenging because healthcare is not their prime business. To large employers, healthcare is just one of the many suppliers they work with, and the cost of healthcare is part of the overhead of a business that is otherwise pumping gas or selling groceries, says David Lansky, PhD, president and CEO of the Pacific Business Group on Health, a nonprofit business coalition that through its member organizations, is "demanding increased value" in the healthcare system.

"So, it is going to be difficult for them to step up to an even larger degree, but it is necessary," he says.

Healthcare Spending Expected to Grow 5.8% Annually Through 2025

Employer-sponsored insurance helps cover the medical expenses of about half of all Americans, according to the Kaiser Family Foundation. Despite the cost of providing this benefit to their workers, large employers are committed to the ESI market, Lansky says.

"There's an understanding that if we don't get a handle on spending at some point, we will have a government-financed system and we will look to the taxpayers to figure out how to cap total healthcare costs. Most employers don't want to see that happen," he says.

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.

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