For the most part, employers have succeeded in holding the line on health care costs for employees over the last few years. But for employees, the premiums keep taking a bigger bite out of their paychecks.
The evidence comes from the latest Commonwealth Fund study. The nonprofit tracked trends in employer-sponsored health insurance over the last decade, gleaned from data from a variety of sources, including the U.S. Census Bureau and annual federal surveys of employers.
The survey revealed that premiums for family coverage have leaped ahead 73 percent over the past decade, and that employee contributions to their premiums rose by 93 percent. Deductibles at both large and small companies more than doubled.
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Meanwhile, the average household income increased by just 16 percent, revealing a widening gap between income and dollars dedicated to health insurance.
To be sure, the survey reports that premium increases slowed measurably between 2010 and 2013. But even with the brakes on rising premium costs, families who depend on company health insurance continue to pay more for it, and get fewer benefits for their bucks.
"While families experienced slower growth in premium contributions and deductibles over this period, sluggish growth in median family income means families are paying more in premiums and deductibles as a share of their income than ever before," the study said.
Citing other research, Commonwealth noted that, in the next few years, fewer than 10 percent of Americans will be getting their insurance via the public exchanges, where premiums are completely offset by subsidies for some. Most Americans will continue to be covered through their jobs.
"When we look at changes in the cost of health insurance and the implications for U.S. families, it is therefore important to examine trends in employer plans," the researchers said. "About 57 percent of the under-65 population—or more than 150 million people—have insurance through employers (either their own or that of a family member) in 2014."
The study found that the average annual health insurance premiums for employer-sponsored family coverage increased from $9,249 in 2003 to $16,029 in 2013. Since coverage premiums rose over the period from $3,481 to $ 5,571—a 60 percent climb.
Commonwealth said the slower growth of premiums since 2010 was a good sign, but was also a trend at risk.
"It is not yet clear whether moderate premium growth will continue," the study said. "The slowdown in employer premium growth reflects a combination of reduced use of services by employees and their families and somewhat slower increases in prices for hospital and other services. However, this may change as the economy recovers and returns to more robust growth. The Centers for Medicare and Medicaid Services recently projected that the costs of private insurance will return to more rapid growth after five years of historically slow increases."
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
