Health insurance premiums still on rise, topping $22,000 a year for family coverage

You probably know it without even looking at your paycheck stub. But finally, here are the grim numbers in a nutshell.

Over the past decade, premiums for family coverage under employer-sponsored health insurance has climbed 47%, faster than wages (31%) or inflation (19%).

This year, family premiums for employer-sponsored health insurance climbed up 4% to $22,221. But the latest rise was less than the average increase in wages (5%) or inflation (1%), according to the 2021 benchmark Kaiser Family Foundation Employer Health Benefits Survey, released on Nov. 10.

“In a year when the pandemic continued to cause health and economic disruption, there were only modest changes in the cost of employer-provided health benefits,” Gary Claxton, a KFF senior vice president, said in written remarks.

The issue is important in Indiana, which relies heavily on employer-sponsored plans for health care. About 54% of Hoosiers, or 3.5 million people, are insured through employer plans, above the national average of 49%, according to the Kaiser Family Foundation. No surrounding state has a higher reliance on company plans.

Nationally, about 155 million Americans rely on employer-sponsored coverage.

The 194-page report does not break out premiums, deductibles or other information by state.

But earlier this year, Nyhart, an Indianapolis actuarial and employee benefit firm, reported that the average monthly premium for family coverage was $1,946, up less than 1% from a year ago.

The 2021 Nyhart data includes survey responses from 285 employers from across Indiana and 528 health plans.

Some other national findings from the Kaiser Family Foundation survey:

• Among firms with at least 50 workers that offer health benefits, almost four in 10 report offering more options to their mental health and substance abuse benefits. That includes wider user of telemedicine, an increase in employee assistance programs and increased coverage for out-of-network services.
• More than half (55%) of firms with at least 50 workers say they expanded their wellness programs during the pandemic, including more online counseling services and additional wellness apps.
• About a quarter (27%) of large firms offer retiree health benefits for at least some current workers or retirees. Of these, 89% offer coverage to early retirees (under age 65) and 65% offer coverage to Medicare-age retirees (65 and older).

In a separate report, the Kaiser Family Foundation showed that annual premiums in 2020 under employer-sponsored plans put Indiana in the middle of the pack of neighboring states. Total annual premiums (both the employer and employee contribution) for Indiana were $20,125.

That’s higher than Michigan ($20,008) and Ohio ($20,088), but lower than Illinois ($21,775), Kentucky ($20,396) and the United States average ($20,758).

That’s an improvement from a year earlier, when Indiana’s health care premiums for family coverage higher than any neighboring state.