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Expand chart
Reproduced from a Kaiser Family Foundation report; Chart: Axios Visuals

The conventional wisdom is that corporate America has a renewed, almost crisis-level concern about rising health costs. But, in a puzzle I am struggling to solve, the data don’t suggest a basis for a new level of urgency about health costs in corporate America.

Why it matters: In fact, just the opposite is true. There's just not that much change — so any solution that's designed for a crisis will probably miss the mark or could unnecessarily harm workers.

The big picture: As Axios has recently reported in Vitals, employer health costs are eating up a larger share of overall compensation that they did 20 years ago. But as this chart shows, over the last 10 years, health costs as a percentage of overall compensation for larger employers — the ones that are most outspoken on the issue — have moved in a narrow band, between 8 and 9 percent of total compensation.

  • For all private employers, it has remained between 7 and 8 percent of compensation over the same period.
  • Premium growth has also been modest — in the 3 to 4 percent a year range — and is not likely to jump in 2019. There is no question that workers are feeling the pain of out-of-pocket costs, but that’s a different problem.

Between the lines: There may be a few explanations for the perception of a health cost crisis in the corporate world. Employers have held costs down, in part, by shifting them to employees. They may now feel cost shifting is nearing a natural limit.

They get blowback about it from their employees, and most have always seen cost shifting as an expedient way to shave their annual premium increase rather than as a meaningful cost containment strategy.

  • Even if health costs have not been growing recently as a percentage of compensation, there still can be sticker shock, with the average cost of a family policy around $19,000 per year, about the cost of a Honda Civic. Plus, health benefits still consume 7.5% of overall compensation for private sector employers — a significant share, though far less than wages (69.6%).
  • The averages also conceal the fact that some employers are getting hit harder than others.

What we've seen in recent years in our employer survey is largely business as usual, with most employers deploying a grab bag of cost strategies, from cost shifting to disease management to wellness programs and more, without expressing great confidence in any one strategy. That approach is more consistent with the data showing the burden of health costs largely stable with moderate cost growth. 

The bottom line: The data on corporate health costs are at odds with the rhetoric of a crisis or the sense that employers are poised to take dramatic action.  Please let me know what I am missing.

Go deeper

Kendall Baker, author of Sports
40 mins ago - Sports

MLB falls out favor with Republicans

Expand chart
Data: Morning Consult; Chart: Will Chase/Axios

MLB is the latest sports league to fall out of favor with Republicans following its decision to pull the All-Star Game out of Atlanta.

By the numbers: In mid-March, MLB's net favorability rating among Republicans was 47%, the highest of the four major U.S. sports leagues. Since then, it has plummeted to 12%, dropping the league below the NFL and NHL, according to new data from Morning Consult.

54 mins ago - World

Blinken makes unannounced trip to Afghanistan to sell troop withdrawal

Photo: CARLOS BARRIA/POOL/AFP via Getty Images

Secretary of State Antony Blinken made an unannounced trip to Afghanistan on Thursday to meet with the nation's president, Ashraf Ghani, and Abdullah Abdullah, who is representing the Taliban in negotiations, per the Washington Post.

Why it matters: Blinken sought to reassure the pair that the U.S. will maintain support for the country, despite President Biden's decision to withdraw troops from Afghanistan starting May 1 and concluding in full by Sept. 11.

Women rise to the top at major media companies

Illustration: Aïda Amer/Axios

Several women have been tapped to lead some of the country's largest newsrooms over the past year — a promising sign of progress for an industry that's typically been slow to accept change and embrace diversity.

Driving the news: CBS News executive Kimberly Godwin was named president of ABC News on Wednesday. Godwin will be the first Black woman to lead a major broadcast news division when she takes the helm in May.