Skip to content

Health Care Reform:

Health Insurance & Affordable Care Act

Who Really Pays For Health Care Might Surprise You

continued...

Although premiums and out-of-pocket costs have been soaring for consumers, costs have been rising for employers, too — up by nearly 80 percent in a decade. Business spends more than half a trillion dollars annually on employee health care.

Government and employers pay for almost all health care.

But give workers and consumers credit. In 2012 households still paid the largest single share of health costs, according to federal actuaries. Part was premiums paid through employers and directly to insurers. Part was out-of-pocket expense.

The household portion of the health-spending pie shrank from 37 percent in 1987 to 28 percent in 2012. But it's still larger than the federal government's 26 percent share or business's 21 percent.

The insurance company is always the bad guy.

Human resources pros like to trash-talk the company's insurance plan when they tell employees the doctor network shrank, the deductible rose or certain procedures aren't covered.

But more than half of all workers with health coverage are enrolled in "self-insured" plans where the employer pays medical bills directly. The insurance company only processes claims.

If your company has at least 500 workers it is probably self-insured

In such plans the employer is the insurance company. And it's the employer calling the shots.

Clarification: This article was updated to clarify that not all of the 8 million people signing up for new health coverage received subsidies.  

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

Thu, Apr 24 2014

Loading …
URAC: Accredited Health Web Site TRUSTe online privacy certification HONcode Seal AdChoices