Kaiser survey; Health coverage premiums up modestly, but more than wage growth

Premiums for employer-sponsored family health coverage in the United States rose 4 percent over last year, a modest increase compared with recent years but still higher than the 1.7 percent growth in workers’ wages, a national survey found.

“A 4 percent increase is a low increase, and it is good news,” Drew Altman, Kaiser Family Foundation president and CEO, said in a phone press conference Tuesday.

The figures are based on the 2012 Employer Health Benefits Survey conducted by the Kaiser Family Foundation/Health Research & Educational Trust.

The 4 percent increase is strikingly low compared with the 9 percent jump last year and double-digit increases in 2003 and 2004, the survey found. In the past decade, premiums have increased a total of 97 percent, three times as fast as wages and inflation, according to the survey.

Kaiser officials said they are not sure why rate increases slowed but suggested that the recession and slow recovery have held down health spending. At the same time, the increase in high deductibles has probably contributed.

“In tough times, when wages are flat, people avoid using the health care system if they can,” Altman said in a prepared statement released with the survey.

The survey noted that premiums were slightly higher in the Northeast, though it did not list figures specific to Connecticut.

Ken Comeau, vice president of the Connecticut Business & Industry Association, said Connecticut has typically seen increases of 4 percent to 5 percent after cost-sharing measures for the last few years.

“We’re typically seeing that after employers go through adjustments to benefit plans year after year, they try and control costs,” Comeau said.

“This is fairly consistent with what we’ve seen the last couple of years. The cost of health care is continuing to go up and, as a result, the cost of health insurance is continuing to go up,” he said.

The Kaiser survey of more than 2,000 large and small employers was conducted between January and May this year.

It found that annual premiums for employer-sponsored family health coverage were $15,745, with workers paying an average of $4,316 of the cost.

The survey also found that employees at lower-wage firms paid $1,000 more out of their paychecks for family coverage and often faced higher deductibles than employees at higher-wage firms. Kaiser reported that 44 percent of low-wage workers had a deductible of $1,000 or more compared with 29 percent of their higher-paid counterparts.

The survey also estimated that 2.9 million adult children are now covered by employer plans due to the Affordable Care Act, up from 2.3 million last year. The provision allows children up to age 26 without their own employer coverage to be covered on their parents’ plan.

Other findings show that:

• 61 percent of firms provide health benefits to employees;
• Average co-pays for in-network visits are $23 for primary care and $33 for specialty care;
• 31 percent offer health benefits to same-sex domestic partners;
• 25 percent offer retiree health benefits compared with 66 percent in 1988; and
• 91 percent of large firms and 41 percent of small firms allow workers to pay their share of premiums with pre-tax dollars.