Saturday, July 6, 2024

Why Capping Future Healthcare Benefits May Not Be In The Best Interests Of SECU Staff And Retirees...


CMS Releases 2023-2032 National Health Expenditure Projections


The Centers for Medicare & Medicaid Services’ (CMS) Office of the Actuary has released projections of National Health Expenditures (NHE) and health insurance enrollment for the years 2023-2032. The Office of the Actuary projects that over 2023-2032, average annual growth in NHE of 5.6% will outpace average annual growth in gross domestic product (GDP) (4.3%). [link]

A 5+% inflation rate in healthcare costs for future and current retirees means that the benefit loses its worth quickly if capped. 5+% x $500 = @$25. So, that capped $500 monthly 2023 benefit is worth $475 in 2024; in 2025 drops to $450; in 2026 down to $425; and in 2027 lower yet to $400. In less than 5 years the employee has lost 20% of the value of the health benefit ( $400/$500 = 80%, or 20% less in purchasing power!). Why do this to long-term, dedicated employees?

😎 The SECU Board and ELT would never consider capping employee wages, would they?

  Of course not!.... would they? What's the difference?