Each year, around this time, the Kaiser Family Foundation releases its annual report on employer-sponsored health insurance. It's always worth a read; this year is no exception:
Employer-sponsored insurance covers over half of the non-elderly population, 147 million people in total. To provide current information about employer-sponsored health benefits, the Kaiser Family Foundation (Kaiser) and the Health Research & Educational Trust (HRET) conduct an annual survey of private and nonfederal public employers with three or more workers. This is the seventeenth Kaiser/HRET survey and reflects employer-sponsored health benefits in 2015.
The good new is that insurance premium cost rose only 4% last year, which is even less than the previous increase of 5%. The bad news is how expensive that still leaves insurance. The average (not "gold-plated") family plan last year was $17,545 in premiums. The average individual plan's premiums totaled $6251. Premiums for family plans increased 27% over the last five years, which is the same rate as the previous five years, but much less than the 69% growth we saw from 2000 to 2005.
Premiums varied significantly, though, depending on benefits, cost sharing, populations covered, and location. About 18% of those with family plans had premium costs of at least $21,000, and about 22% had costs below $14,000.
Employees contributed about 18% of premiums on average for individual plans and 29% of premiums for family plans (although economists would argue that all premium costs really come out of employees wages in reality). Workers in small firms contributed less for individual plans (15%) but more for family plans (41%).
The majority of plans are PPO (52% of covered workers). High-deductible plans (HDHP) were the choice of 24% of workers, HMOs for 14%, and POS plans for 10%. HDHPs have become more popular in the last five years, up from 10% in 2010.
Deductibles increased modestly, to $1318 on average for an individual plan. More than two-thirds of workers also have co-payments, averaging $24 for primary care and $37 for specialty care. Most of the rest pay co-insurance, on average 18% for primary and 19% for specialty care.
No change occurred in the percentage of firms that offered health benefits to at last some employees (57%), nor to the percentage of workers covered at those businesses (63%). More good news for those who feared the employer penalty would hurt full-time workers: Only 4% of businesses with 50 or more employees reported switching full-time employees to part-time, only 5% reported reducing the number of full-time employees they planned to hire, and only 2% reported delays in hiring. In contrast, 10% reported changing part-time workers to full-time status.
Here's the big problem, though. Wages increased more slowly than premiums last year. Worker's pay increased only 1.9%. General inflation declined by 0.2%. So we get this:
Inflation is low, but so are increased in wages. Why? Likely because premiums are still rising in cost far faster than inflation, so that any money which might go to wage increases has to go towards more expensive employee (and employer) contributions to premiums. Further, deductibles are going up even faster, so while wages are flat, employees have to spend more and more of their take-home money on health care.
This isn't good at all. It's not clear how long this might be sustainable, either.