Smaller Rise in Health Premiums
The cost of employer-sponsored health insurance premiums has increased 6.1 percent this year, well ahead of wage trends and consumer price inflation, but below the 7.7 percent increase in 2006, the Kaiser Family Foundation reported today.
Because doctor and hospital costs continue to rise at an even faster rate, the modest slowdown in insurance inflation mainly reflects cutbacks in coverage by many health plans, which have found ways to make employees pay more for their care. Industry experts said that without those measures, premium costs would have risen by 9 percent or more.
The total average annual cost for family coverage premiums rose to $12,106.
“For that kind of money, you could buy a compact car every year,” said Drew Altman, president of the Kaiser Foundation, a nonprofit group that produces the widely watched annual survey. He noted that health costs had increased 78 percent since 2001, more than four times as fast as prices and wages.
That puts average coverage costs at 25% of median median income, before taxes.
The reason costs weren’t higher is due to a drop in coverage and an increase in costs allocated to employees. Ah . . . so that’s it. The cost has dropped for employers, not recipients. Well, that ought to contribute to the old bottom line.