Survey: Modest Rise In Health Coverage Costs, But Employees Assume Bigger Burden

The Washington Post: “Amid high unemployment and a weak economy, employers have been shifting health care costs to workers, according to a study released Thursday. The premiums that employees pay for employer-sponsored family coverage rose an average of 13.7 percent this year, while the amount that employers contribute fell by 0.9 percent, the survey found. For family coverage, workers are paying an average of $3,997, up $482 from last year, while employers are paying an average of $9,773, down $87, according to the survey by the Kaiser Family Foundation and the Health Research & Educational Trust” (Hilzenrath, 9/2).

The Wall Street Journal: “But total insurance premiums paid by the employer and the employee rose just 3% for a family plan—the slowest rate of growth in 10 years, according to the data. The nonprofit research groups surveyed about 2,000 large and small companies between January and May” (Johnson, 9/3).

Kaiser Health News: “Thirty percent of employers reported reducing the health benefits they offered or increasing the employees’ share of the cost. Paul Fronstin, senior research associate with the Employee Benefit Research Institute, a nonprofit, nonpartisan organization, said employers increase workers’ share of premiums only if they are desperate — because it can drive the healthiest employees to drop coverage, resulting in higher premiums for everyone else. ‘Raising the employees’ share of the premium really makes no sense,’ he said. Yet, it’s likely to keep happening. A survey released in August by the National Business Group on Health, an employer coalition, found 63 percent of large employers planned to increase the proportion that employees contribute to their premiums next year” (Galewitz, 9/2).  (KHN is a program of the foundation.)

The New York Times: Businesses may “have felt less need to protect their workers because the increase in the cost of premiums was modest, said Nancy-Ann DeParle, who oversees health care for President Obama. ‘It’s the lowest increase in many years,’ she said. And Ms. DeParle pointed to a number of initiatives under the health care legislation that were likely to help companies better afford insurance, including $40 billion in tax credits for small businesses and $5 billion to help companies pay for retiree health benefits” (Abelson, 9/2).

Los Angeles Times: The shift to workers “could further complicate the Obama administration’s efforts to rally support for the [new health] law, which is expected to do relatively little in the short term to contain rising medical bills. ‘There have been times when employers have been able to absorb costs. This is not one of those times,’ said James Gelfand, health policy director at the U.S. Chamber of Commerce, a leading critic of the new law. … Administration officials Thursday pointed to two new studies from the Rand Corp. and the Commonwealth Fund that predicted small businesses in particular would probably expand coverage in coming years, in part with help from billions of dollars of in new tax credits” (Levey, 9/2). 

Bloomberg: “Total premiums for family policies, including both worker and employer contributions, increased 3 percent to $13,770” (9/2). 

The Associated Press: “Researchers found that businesses still pay at least 70 percent of the total premium, on average, for their workers … A growing percentage of workers are covered by health insurance that requires them to pay a deductible of $1,000 or more before most coverage starts. The increase is most striking with smaller companies, where 46 percent of workers are enrolled in high-deductible plans, up from 16 percent in 2006. At companies with 200 or more employees, 17 percent of covered workers had high-deductible plans, up from 6 percent four years ago” (Murphy, 9/2).

CNN: “Over the past five years, employees’ share of insurance premiums have risen 47%. … Deborah Chollet, senior fellow and health economist with Washington-based Mathematica Policy Research, said the recession and a turbulent job market are key catalysts for rising insurance costs. ‘Employers are struggling to keep their head above water. They’re cutting costs just to maintain employment,’ Chollet said. ‘One way to do that is to make workers pay more'” (Kavilanz, 9/2).

NPR: “Altman says the upward creep of all sorts of health costs for employees, including deductibles and copayments, raises a more ominous question about affordability of health care for the majority of Americans who still get their insurance on the job. ‘While we were all focused on expanding coverage in the health reform debate, I think what we missed is that while that debate was going on, what we call health insurance in the country has actually been changing an awful lot,’ he said. ‘So what most people get as health insurance today just doesn’t look very much like the more comprehensive health insurance their parents got'” (Rovner, 9/2).

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