Navigation Links
Employer health insurance premiums increased 50 percent in every state from 2003 to 2010
Date:11/17/2011

New York, NY, November 17, 2011Premiums for employer-sponsored family health insurance increased by 50 percent from 2003 to 2010, and the annual amount that employees pay toward their insurance increased by 63 percent as businesses required employees to contribute a greater share, according to a new Commonwealth Fund report that examines state trends in health insurance costs. The report finds that health insurance costs are outpacing income growth in every state in the country. At the same time, premiums are buying less protective coverage: per-person deductibles doubled for employees working for large as well as small firms over the same time period.

According to the report, State Trends in Premiums and Deductibles, 2003-2010: The Need for Action to Address Rising Costs, by 2010, 62 percent of the U.S. population lived in a state where health insurance premiums equaled 20 percent or more of earnings for a middle-income individual under age 65. Today there are virtually no states where premiums are relatively low compared to income. In 2003, there were 13 states where annual premiums constituted less than 14 percent of the median (middle) income; by 2010, there were none.

"Whether you live in California, Montana, or West Virginia, health insurance is expensive. Out-of-pocket costs for premiums and care are consuming a larger share of people's incomes at a time when incomes are down in a majority of states," said Commonwealth Fund Senior Vice President Cathy Schoen, lead author of the report. "Workers are paying more for less financial protection. The steady rise in costs from 2003 through 2010, before enactment of the Affordable Care Act, points to the urgent need for health insurance market and health care system reforms."

The analysis of state-by-state trends between 2003 and 2010 finds that premiums for employer-sponsored family health insurance increased 50 percent across states, reaching an average of $13,871 a year by 2010. Annual premiums rose in every state, with increases ranging from 33 percent in Idaho to 70 percent in Mississippi. Premiums for family coverage were highest in New York, Rhode Island, Connecticut, Florida, New Hampshire, and Washington, D.C., ranging from $14,730 to $15,206. But, the report finds that costs were high even in the "lowest" average-cost states. Premiums ranged from $11,379 to $12,409 in Idaho, Arkansas, Hawaii, Montana, and Alabama, the five states with the lowest average costs for private employer-based coverage.

Employees Are Paying More for Less

As premium costs have risen, employers have asked employees to contribute more to their health insurance costs by paying a larger share of premiums and accepting higher deductibles. The report shows that despite stagnant or declining incomes, the annual amount employees contributed to their health insurance premiums increased by 63 percent between 2003 and 2010. By 2010, the cost to employees rose to an average of $3,721 a year for a family policy. Workers in Michigan, Montana, Vermont, Pennsylvania, and Kentucky had the lowest average annual costs for their share of premiums, while workers in Delaware, Maine, Virginia, Texas and Florida made the highest contributions.

Despite paying more for their health insurance, employees are getting coverage that offers less protection. The report finds that per-person deductibles increased an average of 98 percent across states from 2003 to 2010. By 2010, 74 percent of workers faced a deductible, compared to 52 percent in 2003. Average deductibles exceeded $1,000 in 29 states in 2010; in 2003, not one state had an average deductible of more than $1,000. Deductibles were up for employees working in large as well as small firms, although employees of small firms generally faced higher deductibles than employee of large firms did. Deductibles were highest in Wyoming, where the average was $1,479, and lowest in Hawaii, where the average was $519.

Future Trends

The report's authors say that if the historic rate of increase between 2003 and 2010before enactment of the Affordable Care Actwere to continue, the average premium for family health insurance coverage would increase 72 percent by 2020, reaching nearly $24,000 a year.

Slowing the rate of growth even modestly would make a significant difference for individuals, families, and businesses. Compared to historical trends, reducing the annual growth in premiums by even one percentage point would lead to $2,161 in annual premium cost savings for families by 2020. Slowing the rate of growth by 1.5 percent a year would yield savings of $3,173.

The authors note that the Affordable Care Act includes a range of insurance market reforms aimed at lowering premium growth, improving health benefits, and ensuring near-universal coverage. These include a set of affordable insurance options available through new state insurance exchanges, rules limiting insurance administrative costs and profits as a share of premiums, and review of excessive insurance premium increases. In addition, the law contains payment and health care system reforms that seek to slow the growth in costs. The authors point to the urgent need to spread reforms to private as well as public insurance.

Moving forward, the report authors conclude that lowering health care premium growth will require a significant focus on reforming how health care is paid for in the private sector, as well as in public programs like Medicare and Medicaid. In order to improve quality of care while slowing costs, wasteful overhead spending must be lowered and innovative ways of paying for care tested and spread broadly to maximize their impact.

"The combination of rapidly rising costs and stagnant incomes is putting families in an untenable situation," said Commonwealth Fund President Karen Davis. "New rules for insurers, along with new models of health care delivery such as accountable care organizations and new ways of paying doctors and hospitals, can help control health care costs and provide families and business owners with the relief they need."


'/>"/>

Contact: Mary Mahon
mm@cmwf.org
212-606-3853
Commonwealth Fund
Source:Eurekalert

Related medicine news :

1. Employers need to tackle culture of ignorance around breast cancer survivors who work
2. Drug recognition program available for Texas employers
3. Employer Insurance Costs Rising for Workers
4. New report: Employer health insurance premiums increased 41 percent from 2003 to 2009
5. Mental health leaves most costly disability to Canadian employers
6. Employers took many measures to protect employees and avoid business impact of H1N1 flu outbreak
7. IBI Data Offers Solutions to Help Employers Manage Short-term Disability
8. Martin & Jones Announces Class Action Lawsuit Against Major Employer, Claims Thousands of Visiting Nurses Illegally Denied Overtime Pay
9. Allegheny Medical's Occupational Health Services Helps Employers Build a Healthier Workforce
10. Replicon Recognized Among Best Employers for New Canadians
11. Employers Sceptical of Government's Fit Notes Initiative
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:5/26/2016)... Hampshire (PRWEB) , ... May 26, 2016 , ... ... care products, has been honored with a 2016 When Work Works Award for its ... award, part of the national When Work Works project administered by the Families and ...
(Date:5/26/2016)... D.C. (PRWEB) , ... May 26, 2016 , ... On ... men and women who lost their lives in military battle for the country. ... cards in 2015 to provide more programs that empower independence for disabled military veterans, ...
(Date:5/26/2016)... ... May 26, 2016 , ... Catalent Pharma Solutions, the leading ... health and global clinical supply services, today announced two key appointments and the ... investment and strategic growth plans in the Asia Pacific region. , Howard Kim ...
(Date:5/26/2016)... (PRWEB) , ... May 26, 2016 , ... ... of healthcare supply chain solutions, today announced the organization has earned its ISO ... international standards and is compliant with all rules and policies associated with ISO ...
(Date:5/26/2016)... ... May 26, 2016 , ... American orthopedic surgeon ... officer of Blue Horizon International (BHI), Brian Mehling, M.D., spoke at an International ... May 5-6, 2016 in Chicago, IL, USA. Dr. Mehling’s presentation was focused on ...
Breaking Medicine News(10 mins):
(Date:5/24/2016)... , May 24, 2016 Celsion ... drug development company, today provided an update on ... escalating clinical trial combining GEN-1, the Company,s DNA-based ... treatment of newly-diagnosed patients with advanced ovarian cancer ... debulking surgery.  GEN-1 is an IL-12 DNA plasmid ...
(Date:5/24/2016)... May 24, 2016 Los ... terapia del mundo, introduce catéteres para la intervención ... OrbusNeich, una compañía global especializada en el suministro ... expandido su cartera incluyendo productos para tratar la ... Scoreflex™ PTA son los dispositivos de primera entrada ...
(Date:5/24/2016)... -- Dutch surgeons have launched a ground-breaking medical app ... treat patients on a global scale. Medical professionals from ... and the US have already signed up for the ... a totally secure environment. Education  "Imagine a ... with a surgeon at Harvard to treat a bomb victim via ...
Breaking Medicine Technology: