Employer-Based Plan Premiums Up 4 Percent

Americans who buy health insurance through their employer are paying more for their monthly premiums, a new study shows.

The 17th annual  Employer Health Benefits Survey by the Kaiser Family Foundation and Health Research & Educational Trust (HRET) shows a decade-long period of moderate growth in employer-based health plans.

The 4 percent increase in 2014 is the smallest bump in a decade. But it's still financially stressful for consumers who also are paying more in deductibles before insurance companies start chipping in, said Drew Altman,  the Foundation president.

“The pain level is significant,” Altman said of the bump to plans that today affect about half of all Americans.

“It really affects family budgets because their wages aren't rising at the same time. It makes it harder for people to pay the rent or mortgage, pay for gas top get to work, buy clothes or pay for school.”

The report shows that individuals in 2014 paid an average of $90 a month, while family premiums average $413 dollars a month. In 2010, individual premiums were $75 monthly and family plans were $333 on average.

Altman said that since 2005, health insurance premiums have grown an average of 5 percent each year, compared to 11 percent annually between 1999 and 2005. Workers are looking most at the cost of monthly premiums when selecting a plan, so employers are shifting the costs to deductibles to attract employees. 

“If you’re an employer, and I am an employer, one of the very few things you can do to reduce your premium increase quickly, in any given year, is to increase your deductible,” he said.

Regardless, premium costs will likely keep rising, said Gary Claxton, vice president of the Foundation.

"Because of inflation, (premiums) will probably be a little bit higher, but also (prices will be affected by) the pressure of new drugs coming online and just an improving economy. People will demand a little more health care and it tends to push costs up,” Claxton said.

Another concern raised during Tuesday's news conference was the looming "Caddilac" tax that employers will face in 2018. It's a 40 percent non-deductible excise tax on certain, high-cost employer-based plans.

The study shows that employers and insurers already are looking for savings in areas such as creating narrower provider networks, stricter plan management, and increasing the cost sharing between consumers and employers.

More findings from the report:·         57 percent of employers offer health benefits to at least some of their workers, statistically unchanged from 55 percent last year.

·         81 percent of covered workers are in plans with a general annual deductible, which average $1,318 for single coverage this year. 

·         31 percent of large employers offering health benefits have a financial incentive for employees to complete health-risk assessments, and 28 percent have an incentive for employees to complete biometric screening.  

Daylina Miller is a reporter for  WUSF  in Tampa. WUSF is part of  Health News Florida, which receives support from the Corporation for Public Broadcasting.

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