Bigger share of health care costs falls to employees

As companies try to find ways to cut costs during difficult economic times, employers passed more health insurance costs to employees this year and premiums grew more slowly than they have in a decade, according to The Wall Street Journal. However, companies still are paying nearly 75 percent of employees' health care premiums.

Workers paid an average of about $4,000 toward their family coverage this year, which is a 14 percent increase from last year. But total insurance premiums paid by the employer and employee increased only 3 percent for a family plan.

"It's the first time I can remember when employers have coped with costs by shifting it all to workers," says Drew Altman, president and chief executive of the Kaiser Family Foundation.

Employees with family plans now are paying 30 percent of their premiums compared with 27 percent in 2009 and 26 percent in 2005. In the current economy, businesses have to choose between cutting staff and reducing benefits.

"It's no surprise because businesses are struggling to keep their doors open," says James Gelfand, director of health policy at the Chamber of Commerce. "The premium increase may have been modest but it's still a premium increase and businesses can’t absorb those costs."

Cost-shifting seems to have become typical for many who receive health insurance through their employers. Seventeen percent of workers at large firms have deductibles exceeding $1,000 compared with 6 percent in 2006. At small firms, almost half of workers have deductibles that high compared with 16 percent four years ago. As a result of the recession, 30 percent of firms have reduced benefits and 23 percent raised the amount their employees pay for health coverage.

Date : 9/7/2010