Family Health Insurance Costs On the Rise

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Americans are paying more to insure their families, according to a new study conducted by the Kaiser Foundation. On average, workers are spending nearly $4,000 this year toward the cost of family health coverage, an increase of 14%, or $482, above what they paid last year.

The hefty increase took place despite the fact that family premiums only rose by 3%. The amount employers contribute for family coverage did not increase.  Additionally, companies are shifting more healthcare costs on to their employees.

"With the economy struggling, businesses have been shifting more of the costs of health insurance to workers through premiums, deductibles and other cost-sharing," Kaiser President and CEO Drew Altman said in a press release. "From a consumer perspective, the cost of health insurance just keeps going up faster than wages."

According to the foundation, workers’ contributions to premiums have gone up 47% since 2005, while overall premiums rose 27%, wages increased 18%, and inflation rose 12%.

Additionally, many employers have raised the annual deductibles workers must pay before their health plans begin. Twenty seven percent of covered workers now face annual deductibles of at least $1,000, up from 22% in 2009, the survey finds.  Forty six percent of those employed by small businesses, classified in the study as those with 3 to 199 workers, are saddled with such deductibles.

The study attributed the changes in employer contributions to the recession and the residual instability of the job market throughout the last year.  According to researchers, the adjustments carry consequences beyond the higher costs.

"High out-of-pocket expenses and premiums affect health care decisions for patients.  If premiums and costs continue to be shifted to consumers, households will face difficult choices, like forgoing needed care, or reexamining how they can best care for their families," Maulik Joshi,  president of Health Research and Education Trust, (HRET) who partnered with the Kaiser Foundation on the study said.

The Kaiser Foundation and HRET conducted the study between January and May of 2010 by surveying 3,143 randomly selected, non-federal public and private firms with three or more employees -- 2,046 participants responded to the full survey; 1,097 responded to a single question about offering coverage. This is the 12th year the survey was conducted.

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