While individual policies issued on the health insurance exchanges are getting a lot of attention due to very high premium increases for 2017, those policies cover a relatively small part of the population. Employer-sponsored coverage remains the primary source of health benefits for about 150 million Americans. The Kaiser Family Foundation has issued its annual survey of costs and other features for this employment-based health insurance. (KFF Report) On average, across all plan types, for 2016 single premiums were $6435, a negligible increase from 2015, and family premiums were $18142, up 3%. Family premiums have risen 20% since 2011 and 56% since 2006. The family premium in companies with 200 or fewer workers was $17546 versus $18395 for larger firms, probably due to smaller firms having less-rich benefit designs. Overall premium growth has been pulled down by the continuing rapid growth in high-deductible plans, whose premiums were $5762 for single coverage and $16737 for family coverage. The tradeoff for these lower premiums is of course a much greater cost-shift to employees. There is a significant variation in premiums by industry and by geography, and across the spectrum, with a large number of workers covered by plans that cost much more than the average and by plans costing much less than average.
Employees contribute 18% of single premiums, on average, and 30% of family premiums, or $1129 and $5277 respectively. The family contribution has risen 78% since 2006. Employee contributions tend to be higher in small firms, and ironically, also are higher in firms employing more low wage workers. There is significant variation in contributions too, with 12% of workers in plans with no contribution for single coverage and 3% in plans with no contribution for family coverage, while 15% are in plans that require the worker to pay half or more of the premium for family coverage. 15% of workers are in plans which require employees to pay more if they use tobacco. Since premiums are lower, contributions are also lower in high-deductible plans. While PPO designs still cover the highest percent of workers, 29% of employees were covered by high deductible plans in 2016 compared to 13% in 2010.
The usual apologists for the Administration’s disastrous health policies say, correctly, that the cost trend for employer health benefits has been significantly lower the last few years. What they fail to add is that the trend in wage growth, personal income, and disposable personal income has also been lower. The average worker is seeing a larger portion of their income go to health care and the average company is seeing health care costs increase as fast or faster than revenue growth. It is not surprising, therefore, that health care financing worries continue to contribute to widespread anxiety and dissatisfaction about the economy among voters.