Workers bear brunt of health insurance hikes
An annual study of company health insurance plan conducted by Kaiser Family Foundation and the Health Research & Education Trust is reporting today that while companies' health insurance costs rose 3%, workers are paying 14% more this year toward family health insurance -- an average $482 increase.
"For the first time, employers are coping with the rising health care costs by shifting it to workers," said Drew Altman, president-CEO of the Kaiser Family Foundation. "It's adding economic pressure and burdens in a tough economy."
Gary Claxton, the study's lead author, speculated the economy played a role in how employers acted. Trying to avoid layoffs, employers looked at health care costs.
"We are in tough economic times," he said. "They structured their benefit packages not to pay really big premium increases."
Altman warned that increasing costs will affect employees' decisions on whether to go ahead with doctors visits and care.
"At some point this, could be a real barrier to access," he said, warning that there may have to be a further national discussion about the comprehensiveness of health care.
Employees who took individual coverage paid more, too, but not as much more. The survey said they paid an increase of 5%.
The latest survey of company plans was done early this year and was based on plans that companies implemented before Congress approved health care reform. The survey makes very clear how much rising health care costs for company plans have hurt workers.
Since 2005, health care premium costs have risen 27%, but workers' contributions to premiums have risen 47%. Meanwhile wages rose 18% and inflation rose 12%.
While the increase in what employees pay out is the most striking development in the new survey, there were also indications that companies are reducing coverage and shifting to higher deductibles or plans that were more oriented toward Health Savings Accounts than traditional insurance.
The survey said 30% of employers reported the scope of health care benefits or cost sharing benefits of their plans changed, and 23% said they increase the amount employees pay for coverage.
Megan McHugh, research director for the Health Research and Educational Trust, said despite concerns about the quality of medical care, few employers are basing their plan decision on measures of medical quality. She called that "troubling."
Other conclusions from the survey:
--While the biggest portion of employees are still in Preferred Provider (PPO) plans (58%), and Health Maintenance (HMO) plans (19%), high deductible plans grew significantly in popularity in the last year becoming the third biggest category with 13% (up from 8% in 2009)
--The total money workers have to pay for individual and family coverage is growing. This year, workers paid an average of $899 for single coverage and $3,997 for family coverage. That's up from $779 and $3,515 last year.
--The percentage of workers facing a larger deductible for coverage continues to increase. The study said 27% of workers in large firms and 46% in small firms face at least a $1,000 deductible for single coverage, and the percentage facing a $2,000 deductible rose to 10%, up from 7%.