Health Insurance Premiums Jump Up in 2011
Health insurance premiums for workers and companies are growing at a rate thrice that of last year and are much more than wage increases, reveals a new survey. Family premiums paid in employer-paid health plans soared nine percent this year while single premiums increased eight percent, much higher than last year’s three percent and five percent respectively. These findings were reported in the annual study of the Kaiser Family Foundation.
Premiums Outpace Wage Rise
Wage increases are not keeping up with the rise in premiums. In the US, unlike in other developed nations, health insurance is mostly sponsored by employers. In 2010, about 170 million Americans had health insurance via employer-sponsored plans, though many Americans are losing this benefit due to the weak economy.
Steep Rise in Premiums
In the study, more than 2,000 private and public employers were surveyed. It found that employees’ annual contribution towards employer-sponsored family health coverage is on average 28% or about $4,129. This is a 131% increase compared to 10 years ago. Including the contribution of employers, total premium has risen 113% since 2001 to an annual amount of $15,073.
More Youngsters Covered
But, there is some good news as President Obama’s healthcare reforms seem to be bearing fruit. He had targeted increasing insurance coverage for those under age 26. The survey reveals that US companies have added about 2.3 million youngsters to the health insurance provided by their parents’ family plans. Experts say this may be one reason behind the rise in premium costs.
Growing Health Care Costs Cause Concern
Insurers also blame the rise in premiums on growing medical care expenses. Debate is raging over healthcare spending which has risen faster per individual compared to the nation’s economy for the past several decades. Congress is debating on how to reduce soaring health costs even as a congressional panel is trying to cut down the US budget deficit by more than a trillion dollars.