Family health coverage tops $15,000 a year

If you think health insurance premiums are still out of control, you’d be right. Employer-sponsored family health coverage is now $15,073 a year on average — according to the latest annual survey by the Kaiser Family Foundation and the Health Research & Educational Trust. That’s more than a full-time worker at the federal minimum wage makes in a year. It’s also a 9 percent increase over 2010 — nearly triple the rate of general inflation (3.2 percent), and quadruple the increase in workers’ wages (2.1 percent.)

Meanwhile, employee-only health coverage is now $5,429 a year on average, an 8 percent increase over 2010.

The survey found that about 60 percent of the employers offer health-based Employee Benefits to their workers.

On average, covered workers contribute 18 percent of the premium for employee-only coverage, and 28 percent of the premium for family coverage, about the same as in 2010. That means covered workers pay $921 ($77 a month) on average toward single coverage and $4,129 ($344 a month) for family coverage.

Premiums for employer-sponsored family health insurance have risen 113 percent since 2001, while workers wages have risen just 34 percent and the overall cost-of-living has risen 27 percent. Workers’ premium contributions are increasing too. Of the $15,073 total annual cost of employer-provided family health coverage, workers contributed $4,129 on average, and employers contributed $10,944.

Under the Patient Protection and Affordable Care Act — the package of federal health insurance reforms passed in 2010 — young adults up to age 26 who don’t have employer coverage on their own are eligible to be covered as dependents on their parents’ plan. An estimated 2.3 million adult children have been added to policies since that provision took effect. That may account for part of the 9 percent premium increase for family coverage, but it wouldn’t explain the 8 percent increase in premiums for employee-only coverage.

The survey also found that union employers were significantly more likely to offer health benefits: 83 percent of firms that have at least some union workers offer health benefits, compared to 58 percent of firms with no union employees. And large firms with union workers were more than twice as likely to offer retiree health benefits than large firms without union workers – 44 percent versus 20 percent. Retiree health benefits commonly get overlooked, which is a shame as few people know how retirement can affect your mental health. This is something that should be considered when thinking about employee benefits.

Benefits were more costly, on average, at unionized firms: For family coverage, the cost averaged $15,610 at unionized firms versus $14,780 at non-union firms; employee-only coverage is $5,615 at unionized firms, and $5,330 at non-union. The survey didn’t say whether that was because the union firms had more generous benefit levels, or employed older workers, or both.

Union and non-union workers paid about the same percentage of the premium for employee-only coverage (17 vs. 18 percent.) But employers picked up more of the tab for family coverage at unionized firms (79 percent versus 68 percent at non-union firms).

The survey was conducted between January and May of 2011 and included 3,184 randomly selected, non-federal public and private employers with three or more employees.

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