Survey finds employers shifting health costs to workers
While the average cost nationwide for an employer-sponsored, family health insurance policy rose by 3 percent last year to $13,770, an employee’s share of that policy increased by 14 percent, as the average worker’s premium topped $4,000 in 2010.
Although the cost for workers jumped dramatically, the amount employers contributed to family plans did not increase in 2010 because companies shifted more of the cost burden to employees. In addition, employee deductibles rose by 22 percent. More than a quarter of the nation’s workers had deductibles over $1,000 a year. Forty-six percent of employees working at small businesses, defined as firms with 3 to 199 workers, paid deductibles over $1,000 annually.
Those findings came from the 2010 Employer Health Benefits Survey conducted for the 12th consecutive year by the Kaiser Family Foundation and the Health Research & Educational Trusts, nonprofits located in Washington, D.C. The survey was conducted between January and May; 3,143 randomly selected, non-federal public and private firms with three or more employees participated. The results were made public in September.
“With the economy struggling, businesses have been shifting more of the costs of health insurance to workers through premiums, deductibles and other cost-sharing,” said Drew Altman, Kaiser president and CEO.
The survey found that 30 percent of employers reduced the scope of health benefits or increased cost sharing. Another 23 percent reported raising the amount employees pay for coverage.
“This may be helping to stem the rapid rise in premiums that we saw in the early 2000s, but it also means employer coverage is less comprehensive. From a consumer perspective, the cost of health insurance just keeps going up,” said Altman.
Since 2005, workers’ contributions to premiums have gone up 47 percent, while premiums rose 27 percent, wages increased 18 percent and inflation grew by 12 percent.
A surprising finding in this year’s survey was that 69 percent of employers offered a health-insurance plan last year, an increase from 60 percent the previous year. A clear reason for the jump wasn’t known.
Other findings included: Single coverage plans rose 5 percent to $5,049 annually and workers paid an average of $899 for the coverage, up from $779 in 2009; and the average copayment for a primary care office visit was $22, up from $20, and $31 for specialty care, up from $28.
“High out-of-pocket expenses and premiums affect health care decisions for patients. If premiums and costs continue to be shifted to consumers, households will face difficult choices, like forgoing needed care, or re-examining how they can best care for their families,” said Maulik Joshi, HRET president and senior vice president of research at the American Hospital Association.
The survey found that plans from Preferred Provider Organizations continued to dominate the employer-sponsored insurance market at 58 percent. The average cost for a PPO family plan was more than $14,000 last year. The fairly new consumer-driven plans, which have high deductibles and often feature a tax-preferred savings option like a Health Savings Account, had 13 percent of the employer market.
“Consumer-driven plans have clearly established a foothold in the market, tripling their market share from 4 percent in 2006 to 13 percent today,” said Gary Claxton, Kaiser vice president and the study’s lead author.