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Survey Says Contractor Health Insurance Premiums Up Sharply

July 25, 2002
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ARLINGTON, VA — According to preliminary results from a nationwide survey of nearly 300 contracting companies conducted by the Air Conditioning Contractors of America (ACCA), health insurance premiums paid by HVACR contractors have grown an average of 61% from 1999 to 2002.

At the same time, average employment by responding contractors over the last three years has remained flat, and 64% of respondents have reduced benefits to employees since 1999. Another 16% of respondents indicated that they intend to reduce benefits in 2003.

Premiums have increased in all regions of the country, although the areas that appear to have been hardest hit are the Southwest, Pacific Northwest, and Mid-Atlantic.

Contractors also reported that they will spend 7.1% of their total operating expenses on health insurance premiums in 2002, an increase over the past two years of 18%.

“There is a health insurance crisis for small employers in the United States that must be addressed,” said Paul T. Stalknecht, president and CEO of ACCA. “Unlike Fortune 500 companies, community-based businesses, like HVACR contractors, are prohibited from pooling together nationwide to help reduce their insurance costs.

“If Congress were to give these small employers access to association health plans, these employers would be able to lower their costs per employee. On average, large employers spend $1,000 less per employee on health insurance than small employers. This is a situation that is bad for working families and bad for communities. Association health plans will go a long way toward making the situation better.”

Publication date: 07/29/2002

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