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How More Health Insurance Adds Up to Less Healthcare

Cora Nucci, for HealthLeaders Media, September 8, 2010

More employers are offering health insurance to their employees, but workers are paying more and getting less than in previous years. That's according to the 2010 Employer Health Benefits Survey, released last week by the Kaiser Family Foundation and the Health Research & Educational Trust. A goal of the Affordable Care Act is to insure 95% of the U.S. population, but the Kaiser report suggests that coverage alone may not necessarily deliver more healthcare.

The number of employers who offered health insurance to their workers went up significantly in the last year, well before the impact of the health reform law was felt.. Surprisingly, the study found, 69% of employers reported offering health benefits this year, markedly higher than the 60% reported last year. It's not clear why this happened, but don't get too excited. The report explains: "The higher offer rate observed for the smallest firms did not produce a large change in the percentage of workers in firms offering benefits because most workers are employed by large firms."

But while more employers are offering coverage, that coverage doesn't go as far as it used to.  Since 2005, workers' contributions to premiums have gone up 47%, while overall premiums rose 27%, wages increased 18%, and inflation rose 12%, according to the Kaiser study.

For example, while family health premiums paid by employers increased by 3 % to $13,770 in 2010, the average worker's share of the cost spiked 14%, the Kaiser study finds.

"With the economy struggling, businesses have been shifting more of the costs of health insurance to workers through premiums, deductibles and other cost-sharing," Kaiser President and CEO Drew Altman, Ph.D., said in a statement. "This may be helping to stem the rapid rise in premiums that we saw in the early 2000s, but it also means employer coverage is less comprehensive. From a consumer perspective, the cost of health insurance just keeps going up faster than wages."

According to Kaiser, 30% of employers reported that they "reduced the scope of health benefits or increased cost sharing, and 23% said that they increased the share of the premium a worker has to pay. Among large firms (200 or more workers), 38% reported reducing the scope of benefits or increasing cost sharing, up from 22% in 2009, while 36% reported increasing their workers? premium share, up from 22% in 2009."

Ironically, it may be that "increased cost sharing" in the form of higher copayments and coinsurance costs is discouraging the insured from seeking care.

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