Employer Health Insurance Premiums and Out-of-Pocket Costs Increase 41 Percent

Health insurance premiums and out-of-pocket costs have gotten even more expensive for Americans with employer-sponsored coverage, according to a new report from the Commonwealth Fund, New York. The report found family coverage has increased an average of 41 percent across states from 2003 to 2009, which is more than three times faster than increases in median incomes.

Coverage Costs More and Buys Less

With health insurance costs increasing at such an alarming rate, many would think that more services are being covered for the price, but the report revealed that despite increasing costs, deductibles per person rose 77 percent on average in the same time frame.

This means premiums are buying considerably fewer services than in the past, leaving the financial responsibility to policyholders in the form of out-of-pocket expenses.

Will Premiums Keep Increasing?

The study found that if premium costs continue to rise at the pace seen from 2003 to 2009, premiums will increase by 79 percent to an average of $23,342 per family by 2020.

If health care reform slows historic premium increases by 1 percent per year, premiums would be $2,323 lower and if they are slowed by 1.5 percent, the premiums would be $3,403 lower.

So in theory, even under health care reform, premiums will increase–but at least they won’t increase as much.

Lowering Your Own Coverage

While it’s good to be hopeful that health care reform will provide the health insurance premium relief we need, you should always do your best to lower your own health costs:

  • Shop around for coverage: Most employers offer at least two health plans to give you financial options, so examine those options carefully to see which offer the financial benefits you’re looking for.
  • Look for co-payments: Typically, paying a co-payment for a doctor’s visit or for your prescriptions results in you paying less than if coinsurance is a part of your plan.
  • Get healthy: While being healthy won’t control your premiums, it works well in making sure you limit your out-of-pocket costs. Exercise and eat well to control how many times you need to visit a doctor or buy medications.

Unfortunately, the cost of health insurance is completely out of our hands, which is why it’s important to control what we can in regards to coverage. By shopping around, examining your plan options and staying healthy, you increase your chances of paying the lowest amount possible for your family.