Employer-Sponsored Insurance Premiums Rose 119% Over Past Decade

From businessweek.com

http://www.businessweek.com/blogs/money_politics/archives/2009/08/employer-sponso.html

Posted by: Cathy Arnst on August 21

Family premiums for employer-sponsored health insurance in the U.S. increased 119% between 1999 and 2008, far, far higher than any increase in wages, according to a new survey. If current trends continue, premiums are on course to increase another 94% by 2020, to an average of $23,842 per family. Employees pay on average about 30% of this amount.

The study, by the non-profit, non-partisan Commonwealth Fund, found that in 2008 total premiums—the amount paid by both the employee and employer—equaled or exceeded 18% of the average household income for the under-65 population in 18 states, compared to just three states in 2003. In Mississippi, Tennessee and West Virginia, family premiums averaged 20% or more. Southern and South-central states in general felt the pain of rising premiums the most, because incomes are lower than national averages.

“With health spending projected to double if we stay on our current path, middle and lower income families are at high risk of losing their coverage or facing long-term stagnant incomes,” said report lead-author and Commonwealth Fund Senior Vice President Cathy Schoen. “Employers and employees share premium costs but we know that take home pay and retirement savings are being sacrificed to maintain health benefits.”

The report also calculated what would happen if health care reforms were able to slow health care cost increases by 1% to 1.5% per year, as pledged to President Obama in May by a health industry coaltion:

By 2020, slowing the annual rate of growth by 1% would yield more than $2,500 in reduced premiums for family coverage, and slowing growth by 1.5% would yield more than $3,700 in premium savings compared to projected trends.

The report is just the latest in a long line of surveys that show the cost of employer based insurance soaring for businesses and workers. A survey released by PricewaterhouseCoopers in June predicted that the health care costs for U.S. employers will increase 9.2% this year and 9% next year. As a result, 42% of employers said they expect to increase the amount that employees must contribute to health benefit plans, and 41% expect to increase the amount of co-pays, deductibles, and other health costs the employee must pay.

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This is why reform is needed. Because most Americans are getting priced out of health care.

Thanks for the info.

119% then why does what the company charge gone up 600%, not counting the higher co-pays? No wonder Business Week is out of business.