For the majority of Americans who receive health insurance through their employer, 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 Heath 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 to 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,” said the release from Kaiser. “Since 2011, average family premiums have increased 20 per cent, 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 not by nearly as much as premiums used to.
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, or amount that they have to pay themselves for medical care before insurance covers it, at an average of $1,478 per worker. This is much higher than the 49% of people who had a deductible in 2011, and in that year the average level was just $992 per worker.
Additionally, the survey found 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,” said Drew Altman, CEO of Kaiser, in a release accompanying the survey.
This means that Americans aren’t paying too much more on a month-by-month basis, but when they get sick they have to pay more out of pocket costs.
According to data from the Centres for Disease Control and Prevention, around 25% of all Americans have high deductible plans and another 15% have high deductible plans with an added health savings account.
There may be a variety of reasons for this. One explanation 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 non-deductible 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.