Much of the recent attention for the health insurance industry has been focused on the speed with which those who buy coverage through the ACA's mandated exchanges are seeing their premiums rise. However, it's also worth noting that those who get their coverage from their employers, rather than public exchanges, aren't seeing the same types of increases.
The effects of the Patient Protection and Affordable Care Act are now being felt for consumers with employer-sponsored health insurance coverage, as the rate at which their premiums rose from 2010 to 2015 compares favorably with pre-ACA increases, according to new data from the Commonwealth Fund. Those positive effects were felt in 33 states plus the District of Columbia.
Problems still linger
Despite that positive change, though, many report difficulties paying for their plans, the study found. Through the end of last year, the average employee paid about 10.1 percent of the median national income for both their premiums and deductibles as employers continued to shift more costs to workers instead of taking the expense on themselves. That was up from just 6.5 percent in 2006. This problem is particularly jarring in the Southern and Southeastern U.S., because salaries in those regions tend to be lower than the national average.
Employees now pay about $1,255 annually for their premium contributions on single policies, and $4,710 for family plans, the report said. Meanwhile, deductibles are skyrocketing as well, now rising faster than the median income nationwide. The average deductible on a single plan was more than $1,500, up $800 from the level seen in 2006. For families, that number is nearly $6,500, up from about $3,500 nine years earlier.
Issues on exchanges
Meanwhile, individuals buying coverage for themselves through government exchanges are in more dire straits, according to the Middletown Times Record-Herald. In New York, the state-run exchange will see an average increase of nearly 17 percent for premiums on individual coverage. But that comes as some consumers will face rate hikes of as much as 80.5 percent. Meanwhile, some might see increases of as little as 6 percent.
Fortunately for those consumers, more than half of enrollees in the Empire State will receive a tax credit to help them afford their coverage on an ongoing basis, the report said. In addition, the competition in New York among health insurers may help depress coverage cost increases in the future, as 17 companies are participating in the exchange for individuals in 2017. In addition, 18 are offering coverage on the state's small business exchange.
With all this in mind, it might be important for health insurers and brokers to do a little more outreach and explain to consumers why their premiums are going up or their plans are changing. The better people understand the machinations behind these issues, the more likely they will be to accept the current realities of the health insurance industry as a whole.