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Grace-Marie Turner of the Galen Institute on the new model from Sears and Darden that allows employees to shop for their own health-care via business-...
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C news and Darden Restaurants to companies that could be changed the way employer is all -- health insurance -- -- us now sort of negotiating big deals with insurance company.
It's the employers would instead give employees a set amount of money.
Let them shop around for insurance on their -- Joining us now is grace Marie -- of the Galen institute.
Grace very this seems like it's a kind of a 401K.
The health insurance to me it sounds like a pretty good idea in the sense that a lot of the risk comes off.
The employee a full on limited costs down the road.
What do you make of it.
Well even more it gets choices to -- employees.
In this is really their compensation.
And why should they may not have more of a say in the kinds of choices they have.
Yes so this defined contributions I think are absolutely.
What this could it be the next big thing in health benefits and really an employee compensation overall debt.
That is interesting it just seemed to open the door to a new trend.
My colleague Brian doctors on the show Whitman this morning we would talk about -- during the break.
Brian said look this is one of the benefits of Obama cat because the move by C has and Darden Restaurants.
They've been pushed into this by Obama -- it would you say that front yeah and an.
From from what I I gather from what -- is saying and and and reading about it seems that it's entering eight it is introducing an economic relationship between the consumer in the insurance company which does not exist -- right now because that you have the company providing so there is no economic relationship.
This helps I think right down across eventually grace -- is this one of the beaten may -- say benefits of Obama -- You know this is this is -- -- trend we have been moving toward for the last decade because it makes cents and hotly Stuart.
We have here are two examples where.
Government programs have taken the lead the federal employee health benefit program where about ten million federal employees.
Get their health coverage.
Works like -- this where people have a choice of sometimes as many as twenty plants.
-- the areas where they live.
And they get to make choices and the Medicare prescription drug benefit OK now millions of seniors make choices than they're bringing in price is down.
OK so the employer gives me a set amount of money I don't know what we've got few thousand dollars -- go out in the marketplace might choose the plan which I think is best of me which I can afford within the context of that money from my employees got it.
Now supposing I get dreadfully ill and my illness is not covered to the fullest extent by the insurance product that I've chosen.
I can't afford to pay for the treatment which I desperately me then -- it seems to -- the risk has been passed on to the employee.
Well that's that's why you have insurance -- mean -- that -- current cost of them.
Family policy for employer based health insurance.
Is more than 151000 dollars a year employers are paying about 121000 of that that's a lot of money to buy a good insurance product product.
So that you can be guaranteed you're gonna get the coverage you need at -- I think that that's going to be the thing that people look for.
Not how many preventive care services are covered.
But highlight going to be able to get the care I really need.
If I.
For visiting there -- here to -- it isn't there a downside to this that yeah your right to health premiums.
Are going up and inexorably.
But when this be a way for companies off -- -- costs onto employees and couldn't -- more quickly those companies clip and reduce a health care.
Credit or whatever the subsidies going to -- down the road I mean I -- the high costs of affordable.
Care is always been a problem with obamacare but is this a backdoor way for companies to get out of increasing costs for health.
Care you know I think employers have for a long time.
Believe that keeping their workforce is healthy is it because his good business.
There -- not gonna cut this back if they do their competitor down the road is gonna offer a better deal for health insurance.
And they're gonna lose their employees to them so they have a continued vested interest.
In making sure that this contribution is adequate to make sure the people could purchase a health insurance that protects them.
And for and gives them the choice of the kind of coverage they want and I think what they will find.
Is that catastrophic coverage -- coverage for the big stuff.
Is going to be the thing that people make sure they have further and then they can take that policy with them if they moved to -- next -- Chris -- I think -- rights and I think we're all in agreement that this got a 401K.
For health insurance.
I think that's the coming thing I think this is a breakthrough by -- -- on restaurants grace Marie turner.
Thanks so much for joining us we love your drug coverage of the health care business for us we do appreciate it -- for much -- Expect.
