Cost of health insurance not yet hit by inflation, could soon skyrocket

  • The average family health insurance plan is up 1% this year, but experts warn inflation will drive prices up in 2023.
  • Nearly half of Americans said a medical bill put them in debt.
  • About 30% of large employers say their networks do not have enough doctors or behavioral health counselors to provide workers with timely care.

The cost of family health insurance plans has risen just 1% this year, even as inflation hit a four-decade high, with higher prices for gas, groceries, rent and other living expenses.

The average cost of an employer-provided family health plan is $22,463 this year, up $242 from a year ago, according to the Employer Health Benefits Survey. Kaiser Family Foundation published this week. Employers cover most of the health insurance tab for the nearly 159 million Americans who have workplace coverage; this year, workers will pay $6,106 for a family plan, usually through payroll deductions.

Officials warn that major price increases could emerge in 2023 as inflation hits the health sector and hospitals, doctors and pharmaceutical companies demand more lucrative payments from health insurers and health insurers. employers.

Kaiser Family Foundation President and CEO Drew Altman said current prices could be the “calm before the storm as recent inflation suggests bigger increases are imminent.”

Everything else costs more. Why are health insurance prices fixed?

This year’s health insurance premiums were set a year ago before inflation started to take off, according to Gary Claxton, Kaiser’s senior vice president and director of the healthcare market project.

Claxton said the healthcare industry is also dealing with the effects of the coronavirus pandemic. People delayed doctor and hospital visits in 2020 when COVID-19 emerged, so insurers spent less money on routine care and non-emergency surgeries. Insurers’ profits doubled that year.

CLIMATE CHANGE:How climate change is harming Americans’ health — and what experts suggest we do about it

LOOK:Inflation can work in your favor this holiday season. Here’s why.

“Insurers are still making money,” Claxton said. “It’s not like they’re struggling and really need to raise the bonuses.”

The Kaiser report warned with inflation this year at 8% – the highest rate since the early 1980s – employers and consumers could see above-average increases in health insurance premiums this year next. Other analysts agree. Benefits consultant Segal predicts health insurance costs will rise 7.4% next year as employers and consumers absorb bills from doctors, hospitals and pharmaceutical companies.

In a tight labor market, employers are reluctant to charge workers more

Most large companies are self-funded and pay their workers’ medical claims directly, although a private insurer administers the plan. And some companies have been reluctant to charge their employees a higher share of health insurance or pass the costs on to higher deductibles.

Kaiser said the average deductible for an individual is $1,763, up slightly from $1,669 last year. People must pay this amount with their own money before coverage takes effect.

PREVIOUSLY:Inflation is near a four-decade high. So why aren’t health care costs much higher?

MEDICAL INSURANCE :When does Medicare Open Enrollment take place?

“At the start of this year, we were still in a tight job market,” Claxton said. “Recruiting employees is expensive (and) upsetting your existing employees is not a good idea.”

But as employers absorb higher medical costs and the labor market eases, companies may be more willing to raise premiums and deductibles, Claxton said.

Employees of companies with less than 200 workers already have to pay a higher share of their medical costs. The typical small business deductible is over $2,500, about $1,000 more than a large business.

Almost half of Americans have medical debt

Other polls show Americans struggling to pay for medical care as daily expenses rise. About 46% of people said a medical bill put them in debt, according to a poll released this week by telehealth company Babylon.

About 1 in 3 people struggle to afford routine or emergency care and private health insurance coverage. People aged 25 to 34 had the hardest time paying for medical care; More than half of young adults struggled to afford private health insurance, according to the survey of 5,000 adults in August.

A Commonwealth Fund survey last month found that 42% of Americans with health insurance struggled to pay a medical bill or past medical debt. And 46% of working-age adults have skipped or delayed care in the past year because of cost.

The Commonwealth Fund report, however, said those who had employer health insurance had stronger coverage than those who purchased their own health insurance directly.

Mental health networks are insufficient

Employers are also focusing more on the mental health needs of their workers in the wake of the coronavirus pandemic.

The Kaiser survey found that nearly half of large employers said more workers were using mental health care services. Nearly one in three workers say more workers are requesting family leave to deal with mental health care.

But the survey also showed that a long-standing shortage of mental health care providers makes it difficult for workers to see a counselor or other specialist. About 30% of large employers say their networks do not have enough doctors or behavioral health counselors to provide workers with timely care. These shortages persist even though more than one in four large companies have expanded their network of in-person and remote telemental health service providers.

Ken Alltucker is on Twitter at @kalltucker, or can be emailed at [email protected]


Comments are closed.