Group Health Insurance and Big Business

How GM is Forcing Employees towards Individual Health Insurance

Aug 2008

GM has been struggling for the last year to deal with everything from high gas prices to a bad economic market, from housing costs to jittery consumers looking for more cost-efficient vehicles. Now those losses are leading them to cancel their group health insurance policy for many of their employees.

Last year GM posted the second largest quarterly loss in U.S. History, a whopping $39 billion. Recently, they reported another $15 billion for last quarter - and now those losses are driving their workers towards the individual health insurance market, proving that you don't have to be a small business to suffer from the rising costs of health care and a sinking economic outlook.

Several weeks ago GM had announced that the group health insurance plan enjoyed by salaried retirees 65 and over was on its way out. Now, current salaried employees will face changes to their health care that will double co-pays, restrict the addition of dependent older children, and raise some deductibles.

For those who now don't have adequate coverage for themselves or their family members, individual health insurance policies are the only answer.

But isn't there something GM can do? After all, in Wisconsin health care costs for 18 large businesses have actually declined 9% due to their participation in a coalition designed to reduce health care costs for employers by buying into a giant group health insurance plan. Sure, not everyone saved money, but long term plans include a boost in savings for all businesses who participate.

Perhaps GM needs to take a long look at what other companies are doing to save money in health care and protect their employees. The individual health insurance market can be more difficult to navigate, and requires a great deal of shopping around in order to find affordable health coverage.

And keeping their hard-working employees is one thing that GM needs to do if they want to reclaim their crown as the largest and most successful auto maker in the United States.