Managed-care costs are becoming unmanageable for small employers. Premiums for all companies have risen an average of 4.8%, more than double the consumer price index, but small companies have been hit hardest: Hikes averaged 6.9%, says a new study by the Kaiser Family Foundation. What's behind this? Vendors lowballed premiums to grab market share, but now they're trying to recoup losses. "Without negotiating clout, small employers are the first casualties," says Kaiser's Larry Levitt, a co-author of the study.

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