Climbing energy prices may not need any help raising concerns about inflation, but they might get it anyway from a somewhat less-obvious yet powerful menace -- the cost of health care.

The

Federal Reserve

raised its overnight bank lending rate by a quarter-point last week, the 11th such hike, and signaled that more tightening is on the way. The move indicated that inflation remains the central bank's chief concern, and there may be more to the story than just oil prices.

Health insurance premiums have skyrocketed 73% since 2000, while wages have grown only 15%, according to a recent survey by the Kaiser Family Foundation and the Health Research and Educational Trust. The study, meant to measure what health coverage will cost workers and employers, estimated that just 60% of businesses offered health insurance this year, down from 69% in 2000.

Meanwhile, the number of Americans without health insurance grew to a record 45 million last year, according to the Census Bureau, and a majority of those people have jobs. So far, smaller private companies have made up most of the cuts in health benefits they offer, but signs are emerging that major public companies are starting to follow suit as costs become harder to manage.

Profit Pressure

Ford

(F) - Get Report

and

General Motors

(GM) - Get Report

have long pointed to health-care costs as their main barrier to salvaging their competitive position in the auto industry. GM is locked in negotiations with the United Auto Workers union and is seeking concessions in a labor contract that promises generous health benefits to workers.

GM's vice chairman and chief financial officer, John Devine, has said he expects the automaker's health costs to be $5 billion in 2005, up about $1 billion from last year.

"That's been going up in particular in the last couple of years," Devine told analysts earlier this year. "It's put a real drain on profitability, cash and a big dent in our balance sheet as a result of that. We think there is a potential for that to continue with health-care inflation the way it is."

Last week,

Sears Holdings

(SHLD)

cut its medical benefits paid to retirees, citing rising costs and competition from retailers that provide less comprehensive health benefits to workers.

Sears' retirees under age 65 will have to pay the entire bill for their health insurance starting in 2006. Previously, those retirees received a subsidy from the company.

"The changes that we made reflect the realities of the competitive climate of this business," said Sears spokesman Chris Brathwaite. "Most large, successful retailers don't provide access to retail medical benefits and those that do ask the participants to pay the full costs of the coverage. We believe that our program continues to be more generous than most."

Sears workers who retired before 2000 but are under age 65 will be eligible for subsidies again when they turn 65. Those who retired after 2000 will have to pay all their premiums for as long as they remain on the Sears plan.

Brathwaite said spending on medical coverage for retirees in 2004 represented about 50% of Sears' domestic operating income. Earlier this year, Sears Roebuck was acquired by

Kmart

in a deal engineered by hedge fund guru Ed Lampert, who is now chairman of the merged company. Lampert is known for pursuing aggressive cost-cutting measures at retailers where he has owned a big stake, like

AutoZone

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.

March on Washington

But Lampert isn't alone in struggling to control the costs of health benefits in the retail sector. Executives from

Starbucks

(SBUX) - Get Report

and

Costco

(COST) - Get Report

, among others, recently attended a health-care summit on Capitol Hill.

Starbucks Chairman Howard Schultz reportedly told lawmakers that the java giant, which provides health coverage to employees who work at least 20 hours a week, faced double-digit increases in insurance costs during each of the last four years. This year, he said, Starbucks will spend more on health benefits for its employees than on raw materials needed to brew its coffee. He called the burden of these costs on the company "unsustainable."

Also, the presence of Costco's CEO, Jim Sinegal, at the summit could raise eyebrows on Wall Street. Sinegal has been criticized by shareholders and analysts for being too generous with health benefits paid to workers. His company is compared with fellow discount retailer,

Wal-Mart

(WMT) - Get Report

, the world's largest retailer.

Wal-Mart, renowned for being the chief competitive force in most areas of retailing, has been criticized by labor groups and other activists for skimping on health insurance for workers. The company has said that just above 1 million of its 1.2 million employees, or 86%, have health-care coverage. About 586,000 of those workers have health insurance through the company.

Starbucks' Schultz made a case on Capitol Hill that lawmakers should act to reverse the trend in health-care costs being passed on to workers. He cited Starbucks' benefits policy as the main reason for the company's low employee turnover rate and high productivity, and he pointed to its stock price, which has doubled since 2000, as evidence that shareholders have benefited from the policy.

Meanwhile, shares of Starbucks have declined 22% so far this year, while shares of Costco have shed 11%. The

S&P Retail Index

has lost 5.6% for the year, while the

S&P 500

is up 0.4%. Weakness in retail suggests that the industry's growing focus on cost-cutting may be the reflection of increasing pessimism about consumer spending as debt levels continue to outpace wage growth.

Of course, if spending is headed for a slowdown, then passing health-insurance costs along to consumers on top of gas and energy prices will only make matters worse.