Thread: Employers to up workers' share of health costs

Employers to up workers' share of health costs

Tens of thousands of U.S. workers face higher health insurance costs and reduced benefits next year, regardless of whether Congress passes reform legislation, according to an annual survey released today.

The Kaiser Family Foundation and the Health Research and Educational Trust found that nearly 40% of employers surveyed said they were likely make their employees pay more for heath care, including higher deductibles and co-pays for doctor visits and prescriptions.

Premium increases have far outstripped wages and inflation, the survey found. During the past 10 years, employers' contributions jumped an average of 131% per worker, from $4,247 to $13,375. That's three times worker wages and four times general inflation, Kaiser said.


Employees saw their contributions rise 128%, from $1,543 to $3,515. p>

The survey included 3,188 randomly selected public and private firms with three or more employees.

About 159 million nonelderly people are covered by employer-sponsored insurance, Kaiser says.

Yesterday the Business Roundtable, a major business lobbying group, released a report stating that if nothing changes, employer health care costs will jump 166%, to $28,530 per employee, per year, by 2019. By then, total health care spending would reach $4.4 trillion, "consuming more than 20% of the U.S. Gross Domestic Product."

The Washington Post has more about both reports.

Read the full report or the summary. Here's the Business Roundtable report.

Posted by Michael Winter at 03:59 PM/ET, September 16, 2009 in Economy, Money, Washington |

http://blogs.usatoday.com/ondeadline/20 ... costs.html

Average family health insurance policy: $13,375, up 5%

Updated 35m ago
By John Fritze, USA TODAY

WASHINGTON — An average family health insurance policy now costs more than some compact cars, and four in 10 companies will likely pass more of that expense on to workers, according to a closely watched survey of businesses released Tuesday.

The average cost of a family policy offered by employers was $13,375 this year, up 5% from 2008, the Kaiser Family Foundation and the Health Research & Educational Trust survey found. By comparison, wages rose 3% over that period, the study said.

The new numbers underscore warnings by President Obama about the growing cost of health insurance and were embraced by Democratic lawmakers who are pushing for legislation to change the nation's health care system. "The trends are crushing millions of businesses and American families," Senate Majority Leader Harry Reid of Nevada said.

The annual survey of more than 2,000 companies also found that 40% of small-business employees enrolled in individual health plans pay annual deductibles of $1,000 or more. That's almost twice the number who paid that much in 2007.

Drew Altman, president of the Kaiser foundation, said it is the combination of higher health care costs along with the recession and other rising prices that "creates the pain level."

Those who oppose Democratic versions of the health care legislation, such as Senate Minority Leader Mitch McConnell of Kentucky, agree that the rising cost of insurance has become a hardship on families and businesses. The two parties disagree on how to address the problem.

"It's a significant issue for our members," said Jeri Kubicki with the National Association of Manufacturers. "They want to continue to offer this benefit. At the same time, it's a daunting task to try to control costs."

Since 1999, health insurance premiums for families rose 131%, the report found, far more than the general rate of inflation, which increased 28% over the same period. Overall, health care in the United States is expected to cost $2.6 trillion this year, or 17% of the nation's economy, according to the non-partisan Congressional Budget Office.

Sen. Max Baucus, D-Mont., who is leading a bipartisan group negotiating health care legislation, has promised that his bill eventually will drive down costs. Baucus said the bill could come up for a vote this month.

As insurance costs increase, workers are also picking up a larger share, the survey found. The average employee with family coverage paid 26% of the premium, the study found, but 41% of companies said they are "very likely" or "somewhat likely" to increase the amount employees pay for coverage in the next year.

Marion Cowen, insurance coordinator for H.A. Cover & Son Lumber, Co., in Thayer, Mo., said her company switched to a plan with a $1,000 deductible a few years ago. Though Cowen expects the cost of the plan to rise about 4%, she said she doesn't think employees will pay more.

"If there's any way they can bring the costs down, that is the big thing," Cowen said of efforts in Washington. "The costs just seem to be going up, up, up."

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