Health insurance costs are putting immense pressure on Michigan employers and employees — and as the Detroit Free Press reports, it’s not because insurers are seeking bigger profits. Rates are going up because the cost of care itself keeps climbing.
Why health insurance rates are increasing
According to the Detroit Free Press, insurers are paying out far more in claims than they collect in premiums. The main drivers are clear:
- High drug prices that continue to surge year after year.
- Greater utilization, with more people seeking care and procedures.
- Higher provider rates, driven by staffing shortages and hospital consolidation.
The impact on employers and workers
From small businesses like Marquette-based Kall Morris Inc., which says rising premiums are slowing hiring, to large employers facing compounded increases of over 40% in just three years, the pressure is real. Rising health care costs mean less money for growth, raises, and benefits.