- Jim Bourg/Reuters
For the majority of Americans who receive health insurance through their employers, there is some good news and some bad news.
The Kaiser Family Foundation, a nonpartisan think tank addressing health policy issues, released its annual Employer Health Benefits Survey on Wednesday and looked at the cost of insurance for Americans.
Based on the data Kaiser gathered, it appears that the hit directly to American’s wallets is increasing dramatically, but the growth in their monthly payments is slowing down.
Good news first
The good news is that premium costs, the basic monthly payment to be covered, are growing at an incredibly slow rate compared with recent history.
According to the Kaiser survey, average family premium costs increased just 3% between 2015 and 2016, to $18,412.
“This year’s low family premium increase is similar to last year’s (4%) and reflects a significant slowdown over the past 15 years,” a release from Kaiser said. “Since 2011, average family premiums have increased 20 percent, more slowly than the previous five years (31% increase from 2006 and 2011) and more slowly than the five years before that (63% from 2001 to 2006).”
So the monthly cost for most workers is still going up, but by not nearly as much as premiums used to.
- Kaiser Family Foundation
The bad news
The main driver of the slowing in premiums, unfortunately, is the rise of high-deductible plans, according to Kaiser.
In 2016, 83% of workers have a deductible – an amount that they have to pay themselves for medical care before insurance covers it – with an average of $1,478. The average deductible for workers has gone up $486, or 49%, since 2011.
Additionally, the survey found that 51% of workers have a deductible over $1,000 – the first time this has happened since the survey began in 1999.
“We’re seeing premiums rising at historically slow rates, which helps workers and employers alike, but it’s made possible in part by the more rapid rise in the deductibles workers must pay,” Drew Altman, CEO of Kaiser, said in a release accompanying the survey.
This means Americans aren’t paying too much more on a monthly basis, but when they get sick they have to pay more out of pocket.
- Kaiser Family Foundation
According to data from the Centers for Disease Control and Prevention, around 25% of Americans have high-deductible plans, and another 15% have high-deductible plans with an added health savings account.
One explanation for this is that increasing drug prices and costs from medical suppliers have gotten so bad that employers finally decided to share the price hikes with workers. Additionally, there is some evidence that people tend to be more cautious with their healthcare spending in general when they have a high-deductible plan, even for nondeductible costs, so employers are trying to slow the total spending.
Regardless of the reasons behind it, the reality is that people in the US are being forced to dip into their wallets more and more to pay for their healthcare.