Average cost of family health insurance plan climbs 9 percent
The average cost of a family health insurance plan rose 9 percent in 2011, three times the increase from the previous year, according to a survey released Sept. 27.
The average annual premium for family coverage in 2011 is $15,073; the average annual premium for single coverage is $5,429. The 9 percent hike for family insurance compares with a 3 percent increase from 2009 to 2010, according to the Kaiser Family Foundation and the Health Research & Educational Trust.
“This report is just the latest warning that far more needs to be done to address the rising cost of health care,” Karen Ignagni, CEO of industry trade group America’s Health Insurance Plans, says in a statement. “Policymakers in Washington and the states need to focus on all of the factors that are driving premium increases: soaring prices for medical services, changes in the covered population that has resulted in an older and sicker risk pool, and new benefit and coverage mandates that add to the cost of insurance.”
America’s Health Insurance Plans points out that because high unemployment has resulted in fewer younger workers and fewer early retirees, the workforce is older, which has created a higher-risk pool of insured people and higher health care costs.
Also, the trade group says, the provision in the federal health care reform law allowing people 26 and younger to stay on their parents’ health plans has increased the number of people with health insurance, adding to the overall cost of coverage.
“Reducing health care cost growth will make it easier for consumers and employers to afford coverage, ease the burden on federal and state budgets, and put our vital safety net programs on sustainable and fiscally responsible paths,” Ignagni says.
Still, opponents of health care reform insist the health care reform law is not working.
“Despite the president’s repeated promises that the Democrats’ health care law would lower the cost of health insurance, employers are still facing higher health costs,” U.S. Rep. Wally Herger, R-Calif., says in a statement.
The news about higher premiums comes just weeks after a provision of the health care reform law took effect that requires health insurance companies to post to their websites anytime they raise insurance premiums by at least 10 percent or more. As it stands, 26 states and the District of Columbia can veto rate increases for health insurance; seven other states can review rate increases but have no veto authority.
The good news is that many employers ate the recent premium increases instead of passing them on to their employees in the form of higher costs, according to the study.
For instance, in 2011, the average employee contribution for health care insurance is $77 a month for single coverage and $344 a month for family coverage, which is about the same as the amounts paid in 2010, according to the survey. The survey drew from more than 2,000 responses of employees at small and large businesses from January to May 2011.