By Julie Appleby
Tue, Aug 20 2013
For the second year in a row, health insurance premiums for job-based family coverage rose a relatively modest 4 percent, reflecting slowed health spending.
Nonetheless, workers are likely to feel an increased pinch from health care costs: More than a third have annual deductibles of at least $1,000 this year before their insurance kicks in, while wages continue to grow far more slowly than health insurance costs.
The average family plan premium topped $16,000 for the first time, with workers paying on average $4,565 toward that cost, not counting copays and deductibles, according to a survey of about 2,000 employers released Tuesday by the Kaiser Family Foundation and the Health Research & Educational Trust. (KHN is an editorially independent program of the foundation.)
The average cost of a single employee’s insurance premiums rose 5 percent, to $5,884, with workers paying an average of $999, the survey found. Workers’ wages increased 1.8 percent on average, while general inflation rose 1.1 percent. The survey was done between January and May of this year.
"The premium increase this year is very moderate, but the pain factor for health insurance cost has not disappeared," said Drew Altman, president and CEO of the foundation. "Over time, what people pay for health care has dramatically eclipsed both their wages and inflation."
The increases documented in the report, moderate by historic standards, come amid ongoing debate over the federal health law’s ability to rein in health care costs. In July, the Obama administration granted a one-year delay, until 2015, in the requirement that employers with 50 or more workers offer coverage or face a fine, prompting Republicans to call for a similar delay in the rule requiring most individuals to carry coverage. Critics and opponents have also sparred over whether the health law will slow premium growth. All sides may find fodder in the report, observers say.
"You will have the administration and the Democrats saying, 'Look how the health law is helping moderate health cost increases,' and Republicans and those against the law will say, 'It hasn't done anything because costs are still four times inflation,'" said Paul Fronstin, director of the Health Research and Education Program at the Employee Benefit Research Institute, a nonpartisan Washington think tank.
The employer survey found that 93 percent of firms with more than 50 workers offer coverage, down from 95 percent in the 2012 survey. Overall, 57 percent of all employers offer health insurance to their workers, down from 66 percent decade ago. The rate of coverage by employers with 200 or more workers remained steady, with about 99 percent offering insurance. Coverage drops off with firm size, with only 45 percent of the smallest companies offering insurance to workers, down from 55 percent in 2003.