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STOCKTON – Workers with access to employer-sponsored health insurance are paying a greater share of the monthly premium than ever before. Adding to their burden, they’re getting less coverage for their money, according to a major new survey released Thursday.
Nationwide, employees are paying nearly $4,000 on average this year as their share of family health insurance coverage, a 14 percent increase, or $482 more than last year, according to the 2010 Employer Health Benefits Survey from the Kaiser Family Foundation and the Health Research & Educational Trust.
In the past five years, what workers pay for employer-sponsored health insurance has increased 47 percent while overall premiums rose 27 percent. Average wages, on the other hand, have increased just 18 percent since 2005 while inflation rose 12 percent, according to the report.
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The 2010 Employer Health Benefits Survey from Kaiser Family Foundation and the Health Research & Educational Trust provides a detailed picture of private health insurance coverage and costs. The full report and summary of findings is available online at ehbs.kff.org.
“With the economy struggling, businesses have been shifting more of the costs of health insurance to workers through premiums, deductibles and other cost-sharing,” said Drew Altman, president and CEO of the nonprofit Kaiser Family Foundation.
“This may be helping to stem the rapid rise in premiums that we saw in the early 2000s, but it also means employer coverage is less comprehensive. From a consumer perspective, the cost of health insurance just keeps going up faster than wages. It’s the first time I can remember employers coping by shifting virtually all of the costs to workers” in an effort to “hold the line and avoid layoffs.”
Stockton employer Ben Tavakoli, owner of All Foreign & Domestic Body Shop on Navy Drive in the city’s port district, still manages to offer his 50 employees health insurance because “it’s the right thing to do,” but admits “it’s a lot less than I’d like to provide. I think everybody should have insurance. The employee shouldn’t have to worry about it.”
What Tavakoli offers his workers amounts to catastrophic coverage. It’s a Health Savings Account plan, or HSA, through Kaiser, and it costs him an annual $110,000 premium plus a $55,000 “contribution” to his workers’ health-savings accounts. If they don’t need insurance this year, it becomes part of their retirement savings.
The plan for individual workers includes a $2,000 deductible and $1,500 out of pocket before insurance kicks in. For family coverage, it’s a $4,000 deductible and a $3,000 out-of-pocket expense for the employee.
Just four years ago, Tavakoli was paying 100 percent of the cost of a health maintenance organization, or HMO, plan for his employees, but they had to cover the extra cost of covering their families. That cost him about $102,000 annually to cover 10 fewer employees, but the coverage was much more comprehensive. He switched to the HSA plan when the premium more than doubled to $220,000 a year.
