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Ear to the Ground

Employer-Provided Health Insurance Taking a Bigger Bite

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Posted on Jul 17, 2011
Flickr / NoHoDamon

Newly published numbers from the Department of Health and Human Services show that American workers in 2010 paid average premiums of $4,940 for employer-provided health insurance to cover just themselves. That figure increased from $1,992 in 1996. Last year, the average family paid $13,871 for health insurance under employer-provided plans.

For the average American household—whose median income is now about $50,000—the rising price of health insurance is consuming a substantial part of paychecks. Click the link below to see a chart documenting the rise in cost per person between 1996 and 2010, as well as a map showing a state-by-state breakdown of costs. —ARK

National Journal:

Just over 51 percent of workers enrolled only themselves in employer-sponsored health insurance plans, the Agency for Health Research and Quality found. Average premiums were $4,940 for one person; $9,664 for employee plus-one coverage; and $13,871 for family coverage.

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By Travel Insurance USA, April 26, 2012 at 2:49 am Link to this comment

Some blame the rising medical costs for the rise in insurance premiums. Some blame unscrupulous insurance companies for being profit driven. Some blame insurance fraud for depleting the funds that insurance companies have. Who’s fault is it exactly, there will never be one party at fault, and it is the combination of multiple factors over the years that contributed to this problem.

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By Catastrophic Health Insurance, September 1, 2011 at 7:33 pm Link to this comment

Thanks for the post and also read the comments. Great food for thought! I hardly believed that the median income is $50,000. With rising costs of education, hospital bills, inflation and now with higher premiums, the average American is not in the position to actually enjoy the higher median income. If higher hospital bills are turning people to the relatively cheaper insurance premiums, but with rising premiums, what can they turn to next?

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By Royce Tivel, July 18, 2011 at 8:43 am Link to this comment
(Unregistered commenter)

For many retirees with a company medical plan, premiums are becoming alarmingly high. This is because company plans have a fixed cap for the company contribution. So, when a health provider decides to increase their premium—the entire increased cost gets passed onto the retiree. As an example, if the total annual premium is $4000 and the company’s cap is $800, the retiree’s cost is $3200. Now, if the health care provider raises the premium by 25%, to $5000, the entire cost increase is passed onto the retiree: the retiree’s annual premium goes from $3200 to $4200. If the retiree is living on a fixed income—perhaps only a social security check—it is clear that his/her rising premium could force a change to a cheaper health plan—possibly with a huge increase in co-pays and much less coverage—or to drop coverage altogether.

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Hulk2008's avatar

By Hulk2008, July 18, 2011 at 8:11 am Link to this comment

The insurance industry strikes again!
  Insurance for health care is basically INvalid - they play almost no useful function in providing health care other than acting as a payment mechanism with a VERY high administrative cost.
  Originally, health insurers had physicians and other providers actually forming their boards and steering committees.  They were typically mutual companies and operated on a nearly non-profit basis.  That’s all changed since the early 80’s - they are now mostly full-blown profit-making engines - MBAs and bean counters are the rule.  There is precious little being done to actually reduce costs of care.  Even physicians are feeling the pinch - being reduced to drones in service to insurers, NOT the government.
There is significant competition in the so-called free market - but that is to gobble up networks of providers into proprietary units contracted to individual mammoth insurers.  And some insurers have near monopolies in many states.
  Ask yourself if the CEO of Wellpoint or Cigna really “earns” 100 times what a top surgeon makes.  What “care” does the insurer provide? When 40% profits are added to health care costs, premiums are bound to leap up. 
  The US could use an extensive analysis of what’s going on elsewhere - as in Switzerland, where private insurers bid on the claims processing components periodically and the government acts as “referee” and national standards of proper care are defined. 
  Except for true catastrophic cases, direct pay to providers might be a less expensive option.  That’s why many large employers are self-insured/

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By Fibonnaci65, July 18, 2011 at 6:54 am Link to this comment
(Unregistered commenter)

Poor Americans, that is what it has come to.  I tried, I really did, but after receiving the ugliest comments on a local newspaper article about single payer in Canada, I retreated. Only a bitter few in the states understand single payer at all.  Pity, and I will never forgive Obama and the Democrats for caving, never.

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By ArkanEagle, July 17, 2011 at 7:33 pm Link to this comment
(Unregistered commenter)

“The politicians of both parties are nothing more than corporate whores screwing the average worker.”

You got that right, I tried to explain to my die hard partisan co-workers that even if they disagreed with the health care plan, only on what they were hearing from the whores, that the Public Option was the one thing that would have created price competition in the insurance industry, and now their whining about our coverage changes. It is hard to make others understand that our Congress is beholding to special interests and not the interest of the American people. I think they are beginning to come around though….LOL

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Billy Pilgrim's avatar

By Billy Pilgrim, July 17, 2011 at 6:12 pm Link to this comment

I’m self employed and have been for over 9 years. I
formed a small group with myself, my wife as an
employee and my daughter as my wife’s dependent. The
monthly premium is over $1600 a month. I recently
received a letter from my carrier stating that they
are submitting a request to my state’s health
insurance department to raise my premium by 25%. This
is on top of last year’s 25% increase and an 18%
increase the year before. I can’t afford the
payments. My business is down substantially since the
real estate meltdown and recession. I don’t
understand how our government expects the average
person to survive. We needed a public option. Obama
has betrayed the American people. The politicians of
both parties are nothing more than corporate whores
screwing the average worker.

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