* Employer, employee premium costs doubled in 10 years
* Rising costs a potential challenge for Obama and Romney
By David Morgan
WASHINGTON, Sept 11 U.S. health insurance
premiums have climbed faster than wages and inflation this year,
and look poised to accelerate in 2013, adding to voter concerns
about soaring healthcare costs ahead of national elections in
A study released on Tuesday showed that premiums for
employer-sponsored health plans, which cover about 149 million
Americans, grew a modest 4 percent to $15,745 in 2012. It was a
substantially slower rate of growth than in past years,
including 2011, when premiums jumped 9 percent.
But the study's authors, at the nonpartisan Kaiser Family
Foundation and the Health Research and Educational Trust, said
higher costs still took a bigger bite from the income of
middle-class employees, whose wages advanced only 1.7 percent,
as employers shifted more healthcare costs to their workers.
Rising costs could present a challenge for both President
Barack Obama and Republican Mitt Romney in their battle for the
White House. They also pose a dilemma for employers, which
shoulder most of the cost and face the choice of absorbing
ever-higher charges or making their workers pay more.
Polling data shows that soaring healthcare costs rank
alongside the government's Medicare program for the elderly as a
top campaign issue for voters.
While Obama's administration is implementing healthcare
reforms that could help rein in prices over time, neither the
president nor Romney has unveiled a comprehensive plan for
This year's 4 percent increase eclipsed a general inflation
rate of 2.3 percent. Some employers told researchers that
insurers plan to push premiums up another 7 percent in 2013, the
Premiums for employer health plans have doubled over the
past decade, with worker contributions surging, on average, to
$4,316 from $2,137 in 2002, according to data from a
January-to-May survey of 2,100 public and private-sector
LOW-WAGE WORKERS PAY MORE
The growth in premium costs is roughly in line with broader
health spending, which has moderated in recent years as a weak
economy has prompted many people to forgo costly medical
services including doctor visits.
"In tough times, when wages are flat, people avoid using the
healthcare system if they can. We also know that higher
out-of-pocket costs deter utilization," said Kaiser President
But this year, the impact of the slow economy on insurance
premiums also appears to have been magnified by employers'
switching to lower-cost, high-deductible health plans that
increase out-of-pocket expenses for workers. Employer
contributions hit an average $11,429 this year, up from $5,866
The study also shed light on cost and benefit anomalies in
the employer-sponsored insurance market, a pillar of the $2.8
trillion U.S. healthcare system since the 1950s that has begun
to weaken after decades of uncontrolled cost increases.
About 61 percent of companies offer health benefits to their
workers. But researchers found that workers at lower-wage firms
pay $1,000 a year more for family coverage than workers at
higher-wage firms, even though employers with large numbers of
lower-wage workers pay less for the coverage they provide.
Lower-wage firms are also more likely to offer plans with
deductibles amounting to $1,000 a year or more.
Significant changes in premiums and cost-sharing
arrangements have led to a sharp drop in the number of plans
that are exempt from regulations in Obama's Affordable Care Act,
including a provision that insurers pay for preventive care
without imposing deductibles or co-pays on beneficiaries.
The study found that 58 percent of firms now offer exempt
plans, down from 72 percent last year.
Data also showed a 26 percent jump in the number of young
adults receiving healthcare benefits on parental plans under
reform provisions, which extends childhood coverage to age 26.
There are now 2.9 million young adults on their parents'
plans, up from 2.3 million in 2011, the study said.