The cost of job-based health insurance continued to take a bigger bite from workers and employers this year, rising 5% for family coverage.
This increase in total premiums, moderate by recent historical trends, outstripped the 0.7% drop in general inflation and an average 3.1% hike in wages, according to an employer survey released Tuesday.
Family premiums increased to $13,375 annually, with employees on average contributing $3,515 of that cost, the survey shows. Along with paying higher premiums, workers generally also face higher deductibles and co-pays for services as employers shift more costs to employees.
“When health care costs continue to rise so much faster than overall inflation in a bad recession, workers and employers really feel the pain,’’ says Drew Altman, president and CEO of the Kaiser Family Foundation, which released the survey along with the Health Research & Educational Trust (HRET).
The employer survey, in its 11th year, calculated a 131% increase in premiums for family coverage over the past 10 years, more than three times the rise in worker wages and more than four times the inflation rate. Over that time, workers’ contributions to premiums rose 128%.
Health cost increases have hit workers hard as they juggle other household bills during a recession, Altman said. And he added, “Employers always scream the loudest [about health care costs] when the economy is bad.’’
Maulik Joshi, president of HRET, says the survey findings "demonstrate the need for comprehensive, meaningful reform.’’
It was also reported, the average annual premium for health insurance rose 5 percent in 2009, similar to the prior year's increase and considered modest compared with double-digit increases earlier this decade. Over the past 10 years, premiums have risen 131 percent while wages have increased just 38 percent. In that time, inflation has gone up 28 percent.
The report by the Kaiser Family Foundation and the Health Research and Educational Trust found if premiums to cover families increase by 6.1 percent, the average growth over the past five years, they will exceed $24,000 a year by 2019 - a level many health experts consider unsustainable without efforts to rein in costs.
News agencies also report, President Barack Obama and his congressional allies have made insuring nearly all Americans a major goal of overhauling the nation's health-care system. One of their toughest challenges will be trying to cover people like Ron Norton of Worcester, Mass.
Mr. Norton, 49 years old, is an adjunct professor at a local community college who earns about $40,000 a year. He's also one of roughly 200,000 Massachusetts residents who remain uninsured despite a state law requiring residents to have health insurance.
"I can't use up all of my savings just to buy mandatory insurance," Mr. Norton says. It's like penalizing "the homeless for refusing to buy a mansion."
As lawmakers hammer out legislation aiming to extend coverage to the country's 46 million uninsured, one of the most sweeping proposals has so far stoked relatively little debate: a requirement that nearly all Americans carry health insurance, much like drivers are required to have car insurance.
All of the major health bills winding through Congress feature a so-called individual mandate similar to the one in Massachusetts. Mr. Obama supported the idea in his speech to Congress last week. Such a mandate, proponents argue, is necessary to keep premiums affordable: The healthy, who are relatively cheap to cover, help pay for the sick.
Subsidies for premiums would help low-income families gain coverage, while the prospect of fines would prod others to buy insurance.