Family Health Premiums Rise 4 Percent in 2012 -Low Wage Earners Pay More for Less Coverage

[ehrnst]

Annual premiums for employer-sponsored family health coverage reached $15,745 this year, up 4 percent from last year, with workers on average paying $4,316 toward the cost of their coverage, according to the Kaiser Family Foundation/Health Research & Educational Trust (HRET) 2012 Employer Health Benefits Survey released today.


This year’s premium increase is moderate by historical standards, but outpaced the growth in workers’ wages (1.7 percent) and general inflation (2.3 percent). Since 2002, premiums have increased 97 percent, three times as fast as wages (33 percent) and inflation (28 percent).

“In terms of employee insurance costs, this year’s 4 percent increase qualifies as a good year, but it still takes a growing bite out of middle-class workers’ wages, which have been flat or falling in real terms,” Kaiser President and CEO Drew Altman, Ph.D. said.

“Premium growth is at historic lows, which greatly benefits workers. Continuing to ensure that Americans have coverage options that are affordable is vitally important for our nation’s health,” said Maulik Joshi, Dr.P.H., president of HRET and senior vice president for research at the American Hospital Association.

Workers at lower-wage firms on average pay $1,000 more each year out of their paychecks for family coverage than workers at higher-wage firms ($4,977 and $3,968, respectively). This occurs even though the firms with many lower-wage workers on average pay less in total premiums for family coverage than firms with many higher-wage workers ($14,694 and $16,427, respectively).

In addition, workers at lower-wage firms are also more likely to face high deductibles than those at higher-wage firms. Specifically, 44 percent of covered workers at firms with many low-wage workers face an annual deductible of $1,000 or more, compared with 29 percent of those at firms with many high-wage workers. Across all employers, a third of covered workers (34 percent) face a deductible of that size, including 14 percent with deductibles of at least $2,000 annually.

“This year’s survey suggest that working families at the low end of the wage scale face significant out of pocket costs for coverage,” said study lead author Gary Claxton, a Kaiser Vice President and director of the Foundation’s Health Care Marketplace Project. “Firms with many lower-wage workers ask employees to pay more out of pocket than firms with many higher-wage workers even though the coverage itself tends to be less comprehensive.”

Other findings from the study include:
• Worker-only coverage. Premiums for worker-only health coverage increased 3 percent in 2012 to reach $5,615 annually. Workers on average pay $951 toward this coverage.
• Offer rate. This year, 61 percent of firms offer health benefits to their workers – statistically unchanged from last year.
• Cost-sharing for office visits, emergency care and drugs. Covered workers facing co-payments for in-network physician office visits on average pay $23 for primary care and $33 for specialty care. For emergency-room visits, average co-pays are $118. For drug plans with three or more tiers, average co-pays are $10 for generic drugs, $29 for preferred brand-name drugs, $51 for non-preferred brand-name drugs, and $79 for specialty drugs.
• Domestic partner benefits. In 2012, 31 percent of employers offer health benefits to same-sex domestic partners, up from 21 percent three years earlier. This year 37 percent of firms offer such benefits to unmarried opposite-sex partners, up from 31 percent in 2009.
• Flexible Spending Accounts and Pre-Tax Premiums. Large employers are more likely than small ones to allow workers to pay their share of premiums with pre-tax income (91 percent, compared to 41 percent) and to contribute pre-tax dollars to Flexible Spending Accounts (76 percent, compared to 17 percent).


Full report: http://ehbs.kff.org/

[xchrom]

1. du rec. Nt

[ehrnst]

2. Reflections on the 4% increase:

"With the economy only slowly recovering and wage stagnation depressing utilization, there is no reason to expect a return to double digit increases in health insurance premiums anytime soon, if at all. Other new variables could also change the cost picture moving forward, including the implementation of the Affordable Care Act and reductions in Medicare or Medicaid spending that might arise out of budget talks. At the same time, there has been no obvious change in the fundamental underlying drivers of medical costs or in the delivery of, or payment for, medical services that should lead us to think that the recent historically low increases in health costs represents a “new normal.” There is no bigger or more challenging problem in health care than controlling costs, and the recent good news about premium increases is no reason to assume the problem is solved or to back off of new efforts to address it. "


http://www.kff.org/pullingittogether/altman_premium_increase.cfm

[bhikkhu]

3. That's great news!

as noted by Clinton in his DNC speech - its the lowest rate of increase in 15 years!

Absurd as that sounds, the annual increases have been over 10% for a long time, and going down to 4% is hopefully - and likely - a long-term trend toward affordability spurred by the ACA.

Of course it will be spun as bad news by many who don't look up the numbers, and who care much more about a talking point than health care...

[ehrnst]

4. I also hear so many "Obamacare made my premium go up by 75%" rants

Which makes me wonder what those employers are telling their employees...

[bhikkhu]

5. I don't have health insurance myself

...but I do the bookkeeping for my employer who runs his costs through the business. His premium was adjusted down, from $900 a month to $690 a month, for the 2011 calendar year.

At the time there was no notice as to why, but then we got a letter explaining how there would be no premium refunds as they had anticipated the ACA excess-profit provisions and adjusted premiums accordingly!

I think in the long term we should see a big change. My state has its health insurance exchange site up and running with information so far, and next year (barring disaster), looking at the program figures and costs, my family will be able to afford health insurance at last!