Health insurance costs increase, but at slower rate

4:20 PM, Aug 20, 2013   |    comments
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WASHINGTON (USA TODAY) -- Employer-based insurance premiums for families increased 4% over last year, a sign that researchers from the Kaiser Family Foundation said Tuesday indicates the 2010 health care law has not led to significant price increases or dropped insurance coverage by employers.

Prices increased the same amount the previous year, 2012, and by 9% in 2011.

The survey, conducted between January and May 2013 and matched against the corresponding period in 2012, was released by the Kaiser Family Foundation, a non-profit group that studies health care issues. It showed that premium contributions by employees increased about $40 per year for individuals and about $250 a year for families.

Drew Altman, president of the Kaiser Family Foundation, said the report was "good news," adding that the law, also known as the Affordable Care Act, has not caused employers to raise premiums or drop coverage.

"The critics of Obamacare will have a much harder time blaming big premium increases on Obamacare this year because there aren't big premium increases," he said.

The survey also found that 93% of employers with more than 50 employees offer health insurance, even as the Obama administration has delayed for a year a requirement that employers with more than 50 workers provide health insurance.

Altman said that employees are still paying more for health care, because their salary increases, if they have received any, have not kept pace with rising health care costs over the past decade. The survey found that lower-wage employees tend to contribute more for their employer-based insurance than higher-paid workers.

"The perception that people have is people still feel the pain of health care costs," said study lead author Gary Claxton, director of the foundation's health care marketplace project. "That does not call into question that this is a modest rise in premiums - this is good news."

Since 2003, health care premiums have risen 80%, the study showed. Wages have risen only 31% and inflation has gone up 27% in that same period.

In the last year, the study showed that premiums for families averaged $16,351, with workers paying about $4,565 toward their premiums. Wages went up 1.8% and general inflation increased 1.1% over the last year.

Researchers surveyed more than 2,000 small (up to 199 employees) and large employers. They found that employers with at least 35% of employees making less than $23,000 a year required workers to pay $1,363 a year more than employers with fewer lower-wage employees.

Economists are still unsure about why health costs have remained fairly stable over the past couple of years, but Altman said both a slowed economy and changes in the health care system have contributed. At the same time, he said, mergers and consolidation of hospital systems could be pushing up costs.

Wellness programs have also become more popular with employers, with almost all large employers offering smoking cessation, biometric monitoring or lifestyle counseling.

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