Private Versus Public Employee Health Insurance Costs

Health care coverage costs are growing for employers and employees, but the private sector is feeling the pain a lot more than is the public one, as verified by a Statistical Brief from the Agency for Healthcare Research & Quality   (AHRQ Brief).   Based on data from 2012, largely from the MEPS survey, the brief gives a good sense of just how much health care coverage costs.  In 2012 there were about 130.4 civilian employees, public and private, and 113 million or 87% worked where the employer-provided access to health insurance.  Of these, 34 million enrolled in civilian coverage, 12.4 million in single plus one coverage and 21.6 in family coverage.  Average public sector premiums were $6278 for single, $11,642 for employee plus one and $16,301 for family coverage; while in the private sector the corresponding amounts were  $5,384 for single, $10,621 for employee plus one and $15,473 for family.  The higher public cost reflects a typically much richer benefit design, and while the premiums are higher, public employees almost always pay a much lower share of the premium and have lower cost-sharing amounts.  For example, while public employees contributed only $713 for single coverage, private ones paid $1,118; and for family coverage, public workers chipped in $3,088 while private employees paid $4,236.  Eyeball math would suggest that public employees were contributing about 11% of total single premium and 19% of the family cost while private ones paid almost 21% of the total cost for single coverage and 27% for family.  Considering that public employees also get more cash compensation for the same work and have far, far richer retirement benefits, the difference in health costs is disgraceful.  There is no excuse at all for allowing public workers to be better compensated in any respect than the average private sector employee, whose taxes are paying for the public employees, doing similar work.