Health insurance premiums rose by an average of 50 percent nationwide from 2003 to 2010, the Commonwealth Fund found in a report released on Thursday. And costs went up even more for people covered at work—employee contributions to annual premiums increased by 63 percent, the report found.
The average family health insurance plan cost an average of $13,871 a year in 2010, the report found. Annual premiums rose in every state over the seven years from 33 percent in Idaho to 70 percent in Mississippi.
If historical trends continue, the average premium for family health insurance coverage could reach nearly $24,000 a year by 2020, the nonprofit advocacy and research group said.
The report drew insurance data from the Medical Expenditure Panel Survey of employers and income data from the U.S. Census Bureau.
“We find that health insurance is becoming ever more expensive, no matter where you live in the United States,” said Commonwealth Fund Senior Vice President Cathy Schoen. “We now have 23 states where premiums average 20 percent or more of middle-class incomes, compared to only one state in 2003.”
Per-person deductibles doubled for employees nationwide over the same time, the report found, with deductibles increasing more for employees of small businesses than employees of large firms. In 2003, 52 percent of workers had a deductible; by 2010, 74 percent did.
“This increase basically means less take-home pay for other necessities,” Schoen said. “At the same time, insurance is buying less protection.”
In lower-income states, “pressures are particularly severe, and this is typical throughout the South and South-Central United States,” Schoen said. She noted that some low-income states, like New Mexico and West Virginia, have health insurance premiums above the national average.
The projected increase in health care premiums over the next decade could be mitigated—slightly—by implementing health care reform, the report argued. “If widely adopted, a combination of insurance market reforms, payment incentives, and delivery-system changes could reduce national costs by an average of 1 to 1.5 percentage points per year over the next decade,” it reads.
Health care legislation could depress costs with competitive state health exchanges and payment and delivery innovation, among other pressures," said Karen Davis, the group’s president.
A 1-percent decrease doesn’t sound like much, even when compounded annually. Davis and Schoen argued that even a small decrease is better than nothing, particularly for low- and middle-income families.
But the Kaiser Family Foundation has tracked a continuing uptick in health care premiums since the legislation was passed, drawing on employer data.