Since 1999, the Kaiser Family Foundation and the Health Research and Educational Trust have conducted an annual survey of Employer Health Benefits.
According to the foundation, the survey, which is traditionally released each Fall, tracks trends in employer health insurance coverage, the cost of that coverage, and other topical health insurance issues. Findings are based on a nationally representative survey of public and private employers with three or more employees, including those who respond to the full survey and those who indicate only whether or not they provide health coverage.
Health Insurance Premiums are on the Rise
One of the key takeaways for Private Insurance is the rate at which Family Premiums are rising. According to KFF, since 2008, workers’ deductibles have increased eight times as fast as wages.
In 2018, the average premium rose 3 percent for single coverage and 5 percent for family coverage. The average premiums were $6,896 and $19,616, respectively.
However, premiums for high deductible health plans with a savings option (HDHP/SOs) were noticeably lower than the average premiums. HDHP/SOs annual premiums for single and family coverage were $6,495 and $18,602, respectively.
The premium for family coverage was, on average, lower at small employers (three to 199 employees) than at large employers—$18,739 compared to $19,972. Yet, premium costs varied widely across industry and regions in 2018.
Worker Contributions are Lower for Those Enrolled in HDHP/SOs
The average worker contribution toward the premium was 18 percent for single coverage and 29 percent for family coverage. Although, employees at organizations with a high percentage of lower-wage workers (where 35 percent make $25,000 or less annually) made above average contributions—24 percent and 42 percent of the premium for single coverage and family coverage, respectively.
In terms of dollar amounts, workers contributed $1,186 and $5,711 toward their premiums for single coverage and family coverage, respectively. Workers enrolled in HDHP/SOs contributed less on average, paying $1,074 for single coverage and $4,631 for family coverage.
PPO’s continue to be the preferred choice for enrollment. The following were the most common plan types in 2018:
- Preferred provider organizations (PPOs)—49 percent of workers covered
- HDHP/SOs—29 percent of workers covered
- Health maintenance organizations (HMOs)—16 percent of workers covered
- Point-of-service (POS) plans—6 percent of workers covered
- Indemnity plans—under 1 percent
PPO enrollment has decreased by 8 percent over the last five years, and enrollment in HDHP/SOs has risen by 9 percent over the same period.
Employee Cost Sharing
Most workers must pay a share of their health care costs, and 85 percent had a general annual deductible for single coverage in 2018. Fifty-eight percent of workers had a deductible of $1,000 or more for single coverage. The average deductible for all workers was $1,350. The prevalence of HDHP/SOs has contributed to the increase of deductible amounts.
Even without a deductible, the vast majority of workers cover some portion of the costs from their in-network physician visits. For instance, 66 percent have a copayment for primary doctor visits and 24 percent have coinsurance.
Nearly all workers are covered by a plan with an out-of-pocket maximum (OOPM), but the costs vary considerably. Fourteen percent of workers with single coverage have an OOPM of less than $2,000, and 20 percent have an OOPM of $6,000 or more.
Availability of Employer-sponsored Coverage
Similar to the last few years, employers offer health benefits to at least some workers. Only 47 percent of very small employers (three to nine employees) offer benefits, while virtually every large employer (1,000 or more employees) offers coverage.
Health and Wellness Promotion Programs
Wellness programs help employees improve their lifestyles and avoid unhealthy habits. Small and large employers both offer wellness programs, with 53 percent of small employers and 82 percent of large employers offering at least one. Of these large employers, 35 percent offer participation incentives like gift cards or merchandise. Programs vary in topic and include subjects like smoking cessation, weight management and lifestyle coaching.
Site of Care
Over half of large employers have embraced telemedicine, with 74 percent offering health care services through this method. Of these employers, 39 percent offer financial incentives to receive health care services this way, opposed to an in-person physician visit. Firms with 1,000 or more workers are more likely to cover services provided through telemedicine than smaller firms.
Retail Health Clinics.
Seventy-six percent of large firms offering health benefits cover health care services received in retail clinics, such as those located in pharmacies, supermarkets and retail stores, in their largest health plan [Figure I]. These clinics are often staffed by nurse practitioners or physician assistants and treat minor illnesses and provide preventive services.
On-Site Health Clinics
Only 10% of large firms offering health benefits have an on-site health clinic for their employees at one or more of their major locations. A large share of these firms report that employees can receive treatment for non-work-related illnesses at their on-site clinics.
Choosing Self-funding for Small & Mid-Sized Employers Remains Relatively the Same as 2017
Similar to the previous year, 13 percent of workers with small employers are elected in plans either partially or entirely self-funded, compared to 81 percent of workers with large employers. Despite conversations about insurers offering more self-funded plans to small employers, there has not been a noticeable increase in their enrollment.
In the past few years, level-funded plans have become more popular. Level-funded plans are health plans provided by insurers that include a nominally self-funded option for small or mid-sized employers that incorporates stop-loss insurance with relatively low attachment points. Of the employers with fewer than 200 workers, 6 percent reported that they had a level-funded plan, or nearly one-third of the respondents who said they had a self-funded plan.
This year continues a period of a stable market, characterized by relatively low-cost growth for employer-sponsored coverage. While premium growth continues to exceed earnings and inflation increases, the differences are moderately small. Additionally, while there have been some changes in terms of employer-sponsored health benefits, no trends have gained significant traction.
The recent trend of raising deductibles to offset premium increases is popular, but its growth has slowed. A reason for the slowed growth is that health benefits are a highly effective attraction and retention tool, especially in a strong economy and tight labor market, and employers want to recruit and retain top talent.
Looking forward, employers should begin to identify tools and resources they can use to offset higher premium growth. As costs continue to rise, the individual mandate repeal takes effect and possible political changes ensue, employers and employees may begin to see increased market movement.
For more information on benefit offerings or on what you can do to control your health care costs, contact the Horton Group.
Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.