The Rising Cost of Health Insurance through Employer-Sponsored Plans
New York, CNN Business — Employers and workers are grappling with the skyrocketing cost of health insurance coverage in 2018. A new Kaiser Family Foundation report sheds light on the financial burden families face, with expenses nearly reaching $20,000 for family health insurance coverage.
Premiums have seen a moderate increase in recent years, but the surge has far surpassed the growth in workers’ wages over time. The average family premium has surged by 55% since 2008, which is twice as fast as workers’ wages and three times as fast as inflation, as revealed by Kaiser’s Employer Health Benefits Survey. Employers bear the brunt of the cost, forking out an average of $14,100 annually. However, workers are still required to pay an average of $5,550, marking a 65% increase from a decade ago.
For single coverage, the total premiums have spiked to $6,900 on average, rising by 47% since 2008, with workers contributing around $1,200 per year. Deductibles have also become a financial strain on workers, with the average deductible reaching $1,350, an increase of 212% since 2008—eight times faster than wage growth.
Current Health Insurance Landscape
The rising cost of health insurance has led employers to shift the burden onto workers by raising deductibles. Unfortunately, this strategy has led to more Americans experiencing financial strain and dissatisfaction with their health coverage.
According to Kaiser’s president, Drew Altman, as long as out-of-pocket expenses such as deductibles, prescription drugs, and surprise medical bills continue to outpace wage growth, individuals will continue to face challenges with their medical bills, turning health costs into a significant financial and political concern.
Employers’ Response to Rising Costs
To tackle the escalating health care costs, companies like Amazon, Berkshire Hathaway, and JPMorgan Chase have joined forces to provide better health care options to their employees while reducing costs for both the workers and the companies. Additionally, more companies are now partnering directly with hospitals and health care providers to manage their workers’ health needs effectively.
General Motors and Henry Ford Health System recently established a contract to offer comprehensive health services to GM employees and their families. This move aims to provide quality care while minimizing costs for both employers and employees.
Adapting to New Healthcare Trends
In response to changing trends, more large companies are now offering telemedicine services to their employees. Despite the availability of telemedicine, the adoption rate among employees remains low. While companies are investing in this technology, employees have been slow to embrace it, indicating a disconnect between the offerings and the actual usage.
The escalating costs of health insurance through employer-sponsored plans demand innovative solutions and collaboration between companies, employees, and health care providers to ensure affordable and quality care for all.