Health Care Bills: From Employer to Employee?
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Published in U.S. 1 Newspaper on June 21, 2000. All rights
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Commercial Real Estate Stragglers
E-mail: MelindaSherwood@princetoninfo.com
If the commercial real estate industry has been slow
to make the transition to the Internet, it’s for a good reason.
"They
didn’t need it," says James Young, president of the Jameson
Group, a real estate technology services firm. "They were making
more than enough money without it, and to some extent the secret of
success in real estate is to have information that others didn’t —
to hide it. That’s a little at odds with the openness of the
Internet."
Consequently, the way commercial real estate companies bring value
to their customers is going to change dramatically once information
technology is introduced — as it will and must be — to the
industry, says Young. "There’s a great parallel with the financial
services market," he says. "Their value will be negotiation,
data analysis, trend analysis, and really helping people strategize
as opposed to just helping people do the transaction."
Young will speak on "The Impact of Technology on Real Estate"
at the National Association of Industrial and Office Properties
meeting
on Thursday, June 29, at the Hyatt Regency in New Brunswick at 5:30
p.m. Princeton-based nex-i.com is sponsoring the meeting. Call
732-417-9010.
Cost: $75.
Young’s San Diego-based firm (www.tjg.com) is devoted to transitioning
the real estate organization of the past century into the new digital
structure. "The way you design, buy, sell, build, and manage real
estate is a paper-intensive process, so everyone sees this new
technology as a great way to streamline the way companies do
business," he says. Soon people will sign their leases, keep track
of tenants, and handle procurement completely online, "right down
to how they change lightbulbs," says Young. "Instead of
calling someone you just jump to the Web and the guy
shows up."
Young, a graduate of SUNY Buffalo, Class of 1980, holds a degree in
political science, but moved into computers and helped automate
several
Fortune 500 companies after school. He started automating the
commercial
real estate industry seven years ago, when he became a broker.
The greatest challenge is getting the old economy companies to look
at the new economy, and the new economy companies to accept that the
traditional companies have a lot to offer, says Young. "It’s a
lot like talking to farmers plowing the field with horse and spade
about tractors," he says. "They’re too busy digging holes
with a shovel to learn about the tractor."
Companies that take five minutes to analyze the new tools, says Young,
will see how their commercial real estate practices can go through
the roof.
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Health Care Bills: From Employer to Employee?
If the government has its way, the United States will
have the best health care coverage that no one can afford, says Paul
Langevin of the New Jersey Association of Health Plans
(609-581-8237),
an organization that represents the nine largest health insurers in
the state. "We have many mandates that are driving up the
costs,"
he says. "We cannot just offer an HMO product, we have to offer
a point-of-service product, set up claims payment system, make
allowances
for out of network benefits, et cetera. It’s kind of like saying
everyone
in New Jersey who wants to drive a car has to drive a car with
automatic
transmission, power windows, and so on, which is great for people
driving cars because they’ll have luxury standards, but they’ll be
a lot less people driving them."
There could be fewer people with health insurance in the future too,
says Langevin, who speaks on Tuesday, June 27, at 8 a.m. at the
Middlesex
Chamber meeting, "Health Care and Your Business: What is Happening
to the Cost in New Jersey," at the DeVry Institute. Also speaking:
State senator Jack Sinagra, Harvey Holzberg
Wood Johnson University Hospital, and Melanie Willoughby, executive
director of the New Jersey Retail Merchants Association. Call
732-821-1700.
Cost: $15.
As a result of government regulations, an aging population,
significant
increases in pharmaceutical costs, and the consolidation of the health
plan market, health care costs are approaching double-digit inflation
rates, says Langevin. "There has been less artificial suppression
of premiums in order to gain marketshare, so now premiums actually
reflect what it costs to cover the real medical costs," says
Langevin,
who spent 21 years working for the State Health Department before
joining the NJAHP in 1995. He has a BS in environmental science from
Rutgers, Class of 1975, and a masters in public administration from
Rider.
The New Jersey Association of Health Plans is an advocate and lobbyist
for Aetna U.S. Healthcare, Americaid, Amerihealth, Cigna, Horizon
BlueCross/Blue Shield, Americhoice (formerly Managed Health Care
Systems),
Oxford Health Plans, Physicians Health Services, and United
Healthcare.
"There seems to be a movement in legislative circles to eliminated
closed-panel HMOs," says Langevin, "and what they’re trying
to do is make the HMO panel look like indemnity insurance used to
look, where there were no questions asked and usual and customary
charges were paid." The healthcare customers would simply receive
service, pay the bill, and then send the claim to the insurance
company
and they pay back the customer directly.
Under the current system, where employers pay premiums, however, the
real cost of health care is hidden from the consumer. "The whole
idea was to have a market that was responsive to market demand,"
says Langevin. As people grew frustrated with the limited network
offered by HMOs, and moved to an open network health insurance plan,
costs have been driven up to the point that even the health insurance
companies aren’t making a significant profit, says Langevin.
"There’s some sense that the insurance industry is making so much
money that you can continually add requirements to the insurance
packet
and that it can be absorbed without any effect," he says, "and
that’s absolutely not so. We probably sell about $4.5 billion in
policies
per year, and in 1998 we lost money on that."
Employers have been absorbing most of those healthcare costs as a
way to attract employees in a tight job market, but if the economy
takes a bad turn, says Langevin, the costs will eventually be passed
on to the consumer. "The economy is moving at a fever pitch now
and we’ve all become pretty comfortable, but we could be in for a
very rude awakening," he says. "If the economy turns and
unemployment
goes up, employers will feel less inclined to provide health coverage
and health costs will be passed on to employees, or employers will
drop it altogether."
If employers drop health insurance, fewer people will be paying for
the coverage of all. One of the options currently being discussed
by businesses and healthcare providers is moving from a defined
benefits
(employer-funded) health plan to a defined contributions
(employee-funded)
health plan, says Langevin. In a defined contribution system, an
employer
gives employees an allotted amount of cash to shop around for their
own health insurance.
If that happens, says Langevin, individuals — especially young
healthy individuals — may choose to opt out and not buy health
insurance at all. "A 25-year-old male who is single does not
expect
to become ill and doesn’t require routine physical checkups may decide
that $5,000 is better spent on a car," says Langevin. "They
get out of the insurance pool altogether, which means the people left
in the pool will have to pay for their own health insurance. Prices
will go up dramatically."
Top Of Page
Pharma & the Net
Running on steam generated by the school’s new MBA
program
in pharmaceutical management, Rutgers Graduate School of Management
hosts a conference on "How Pharmaceutical Companies are Using
the Internet," on Tuesday, June 27, at 8:30 a.m. at Rutgers’
Engelhard
Auditorium in Newark.
Bill Tremayne, president of the Healthcare Institute of New
Jersey, and Howard Tuckman, dean of the graduate school, will
give the opening remarks. The keynote speaker is Joel Lewis,
district manager for Internet services for AT&T, who discusses the
current trajectory of the Internet. There will also be a panel
discussion
on Web-based initiatives already in place in the state’s
pharmaceutical
companies, and how physicians, healthcare providers, and customers
will soon be using the Internet commonly for health care needs.
Call 973-353-5177 for reservations.
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