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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: mishedlo who wrote (51833)1/28/2006 10:39:17 AM
From: GraceZ  Read Replies (1) of 110194
 
Companies are slashing benefits and raising co-pays and deductables

You are making a fundamental logic error here. Because companies are asking the employee to share a higher proportion of the cost you think that the cash value of what the employee is provided has fallen, it hasn't, it has risen sharply and this is the primary reason why companies are so keen to get employees to cover more of the cost.

Companies are attempting to raise co-pays primarily because the cost of the non cash compensation benefits have risen sharply as their workforces have aged. A rising cost of health insurance doesn't lower the benefit, it raises it. The data that I linked to measures that, why not see if it confirms your suspicion that it is falling?

I pay my own health insurance, always have, so I'm acutely aware of the price (which isn't far off from what large employers pay per employee). Our premiums are about 4x what they were in 1987, so if I was employed and that same plan were offered by my employer on my behalf (my husband's company offers almost an identical plan to their employees) it would be equivalent to a raise on that portion of my compensation, minus whatever increases the employer may have wanted me to "share" with them.

There are also many other non-cash benefits aside from health insurance. Some low paying jobs come with housing. I was just asked to do a cost analysis for a friend who lives in a NYC coop that has a super and two porters that all receive an apartment as part of their compensation package. How much has that benefit been reduced in the past few years?
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