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Enterprise Minnesota Magazine - February 2009

HELPING MANUFACTURERS GROW PROFITABLY

Final Word

Want Health Care Reform? Be careful—the cure might be worse than the disease.

BY TOM MASON

The most startling revelation in this year’s State of Manufacturing survey has to be that unchecked and skyrocketing costs of employee health care benefits remain the top source of corporate heartburn to Minnesota’s manufacturers, even under the ominous clouds of an increasingly bleak economy.

All through the focus groups conducted in conjunction with the State of Manufacturing project, it was clear that executives’ frustrations with health care derive as much from a sense of powerlessness as from cost. Few entrepreneurial employers understand the complexities of health insurance beyond the annual double-digit increases in their premiums. The same executives who can lean up their production floor with an intricate array of computers and unique high-tech gizmos will frequently stare at their premium increases with the same blank look that they might give a teenager who comes home with a new tongue stud—that is not so much an intellectual frustration as it is an exercise in futility. You take it or you leave it. In good economies they scratch their heads and absorb the increase. In troubled economies, they have to decide between cutting the benefit and/or passing the increase on to employees—or in the case of one focus group participant, to simply wipe out the health care benefit and leave employees
to fend for themselves.

To compound employers’ frustrations, few employees pay any attention to health care unless confronted by a premium increase or when trying to negotiate or understand a claim. Instead, employees have come to view their benefit package as an entitlement that has already been factored into their compensation package. In their minds, premium increases rob them of a pay increase.

It is time to pay attention. A couple of years from today, health care will be “reformed.” A new generation of policymakers—of both parties and representing both state and federal government—embrace the notion that a crisis is a terrible thing to waste. For better or worse, they will likely use federal involvement in economic stimulus to promote and pass a comprehensive series of reforms that might rival the “Great Society” in scope and legacy.

Manufacturers—you—should be a part of this process. Because frankly, whether these changes are done with you or to you will largely be a measure of how seriously you take your involvement. You should strive to capture the remarkable can-do spirit of the executives in northern Minnesota (featured on page 5) who took charge and developed a creative initiative to bring the lessons of lean to their local health care providers. Your elected officials hold manufacturers in high esteem as premier job creators in your communities. Your opinion about health care reform will be heard. All you have to do is voice it.

Tom Mason is president of Mason Public Affairs Inc. He can be reached at tmason@mason-publicaffairs.com.

©2009, Enterprise Minnesota. All rights reserved. Reproduction encouraged after obtaining permission from Enterprise Minnesota. Additional Magazines and reprints available for purchase.

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