Employer contributions to a workers heathcare plan are considered a "non-wage" form of compensation. The employee does not pay it, the employer does.
As you can see from this graphic, not only has the employee portion of their healthcare premiums increased significantly since 2000 (which they pay out of there earned income/wages), but the employer contributions on behalf of the employee (which the employee NEVER sees) has also increased dramatically.
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| Source: Wall Street Journal |
Each employee becomes more expensive in wage + non-wage compensation. Firms hire fewer workers "at the margin" and/or there is less money available for employee compensation.
A source (not necessarily THE source) of income and employment stagnation in the last 12 years for the Middle Class?
Seems somewhat reasonable to me. What do you think?
Agreed. Great graphic.
ReplyDeleteSome days I think health care costs are going up so fast because "that's where the money is" (because of medicare & all that).
Plus I think the doctors offices are really milking it. (Do I need to get weighed every time I go to the doctor?)
Oh, you caught me on a grumpy day :)
Agreed.
ReplyDeleteI had to see my family practice doctor to tell him my knee was hurting so he could refer me to a knee specialist. I could not go to a knee specialist first! I was weighed at both places. My blood pressure was taken at both places. I had an X-Ray and an MRI. The surgery will cost $35,000 dollars to fix two problems. No, they are not making me bionic. Out of pocket I will pay 3,500. Insurance takes care of the rest. The cost of health care is out of control.