The rate of inflation for health care has been in the double digits for many years. Double-digit inflation increases are predicted for the next decade. This is a growing concern for all employers.

Health insurance carriers cite the following items contributing to the increase in health care costs:

(1) Prescription drugs - This expense is projected to grow 20 to 30 percent per year over the next several years.
(2) New technologies and treatments - The development and administration of new advances in treatment are costly.
(3) Increased demand for health care - People with medical insurance seek new technologies and treatments. This leads to more insurance claims for payment by insurance companies.
(4) America’s aging population - Eighty million people will turn 50 in the next 10 years. The cost of providing health care to these individuals is tremendous.

(5) Increase in uncompensated care - There are an estimated 44 million Americans without health insurance. The cost of providing care to these individuals is borne directly by insured consumers.

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