WASHINGTON — Average premiums for job-based family health coverage are up just 3 percent this year, while the cost of single coverage rose only 2 percent, continuing a sustained trend of moderate growth in insurance costs, according to a nationwide survey of more than 2,000 businesses.
The slowdown in premium growth is good news for the estimated 150 million Americans with employer-sponsored health coverage.
But the overall benefit to consumers is muted because the slowdown is occurring amid relatively flat wage growth and a noteworthy rise in deductibles, the out-of-pocket costs that patients pay before their coverage kicks in.
Employer-sponsored coverage for a family of four costs an average of $16,834 this year, compared with $16,351 in 2013, according to the annual Employer Health Benefits Survey by the Kaiser Family Foundation and the Health Research & Educational Trust, the education arm of the American Hospital Association.
Individual coverage costs an average of $6,025 in 2014, compared to $5,884 last year.
Both increases pale in comparison with the double-digit premium hikes that occurred from 2000 to 2004. And they continue a nine-year run of mostly 3 to 6 percent annual increases, the survey reported.
In fact, this year’s 2 percent hike for individual coverage marks the first statistically insignificant premium increase in the survey’s 16-year history.
As they did in 2013, covered workers pay an average of 29 percent, or $4,823, toward their family insurance costs in 2014. Employers pay the other 71 percent, an average of $12,011, the survey found.
Single workers pay an average of 18 percent, or $1,081, toward their coverage, with employers picking up the remaining 82 percent, or $4,944. Those percentages are also unchanged from last year.
Most experts credit the slower premium growth to a sluggish economy that limits consumers’ use of health services, the proliferation of less comprehensive coverage and more efficient delivery of health care services.
But there’s little agreement on which of these factors is most responsible for the slowdown and how soon, or whether, insurance costs will begin to pick up, said Drew Altman, the president and CEO of the Kaiser Family Foundation, a health policy research group.
“There is no question but that we are seeing historic moderation in costs, including in premiums, now over a considerable period of time,” Altman said during a conference call Wednesday. “But if you say that to an average person, they may very well look at you like you’re out of your mind.”
That’s because workers’ earnings and inflation have grown 2 percent and 2.3 percent, respectively, this year, virtually nullifying the effect of the slow premium growth.
In addition, the average health-plan deductible of $1,217 for single coverage – while virtually unchanged from last year – is up 47 percent from 2009, when it was $826, as employers continue to shift more health care costs to workers.
This year, 41 percent of covered workers face deductibles of at least $1,000, nearly double the share from five years ago. Eighteen percent have deductibles of at least $2,000.
On average, deductibles for all types of family plans have increased along the same trend lines as those for individual plans, according to Kaiser.
