Family health premiums up 5%

Premiums for employer-sponsored health insurance rose to $13,375 annually for family coverage this year-with employees on average paying $3,515 and employers paying $9,860, according to the 2009 Employer Health Benefits Survey released by the Kaiser Family Foundation and the Health Research & Educational Trust.

According to Jordan Battani, principal at CSC, a consulting and outsourcing company, in Falls Church, Va., for managed care executives, the big issues are still the rising cost of coverage and the impact that rising costs have on health plan membership.

“Although the increases this year are lower than in preceding years-they still far surpass general inflation-which was negative,” Battani says. “As general economic conditions decline, the ability of individual consumers and employer purchasers to withstand price increases erodes, and they may exit the market.”

Another factor, particularly as it relates to employer purchasers who compete in an increasingly global economy, is that extraordinary costs in the market place U.S. employers at a competitive disadvantage, according to Battani.

“Again, these employer purchasers may decide to exit the market-either by dropping employer sponsored coverage, or in a more dramatic fashion, by abandoning the U.S. labor force entirely,” Battani says.

Employers and managed care executives must continue to focus on addressing the underlying costs of healthcare, and the underlying inflation that drives premium. Of particular importance is the direct and indirect healthcare costs associated with long term chronic disease, Battani says.

Managed care executives should make efforts to support these workplace programs, she says, and perhaps design value-added services for employers that will assist them in promoting expanding and maintaining them.

“At the same time, it is probably time to re-examine the strategy of shifting costs to consumers, either through high-deductible plans or in the form of copays and coinsurance,” Battani says. “These strategies may have been effective in moderating the growth of employer premium costs, but this study suggests that for many consumers they are proving onerous or unsupportable on an individual basis.”