Study: Health premiums up 5%

WASHINGTON — Premiums for job-based health insurance are up 5 percent in 2008 and have more than doubled since 1999, a growth rate that far outpaces inflation and the increase in workers' wages in the same period, according to an annual survey of employers.

Meanwhile, a growing number of workers at smaller firms are getting less coverage for their money as health plans with high deductibles and fewer benefits become more prevalent.

The portion of workers with single coverage paying a deductible of at least $1,000 has jumped from 10 percent to 18 percent in the past two years. Among smaller firms with three to 199 employees, the rate has more than doubled from 16 percent to 35 percent.

"We may be seeing the tip of the iceberg of a trend toward less comprehensive, skimpier insurance with higher out-of-pocket payments for working people," said Drew Altman, president and chief executive of the Kaiser Family Foundation. "That's bad news at a time when workers are being hit by other economic pressures from declining 401(k)s to higher food and gas prices and problems paying the rent and mortgage."

On average, workers pay $3,354 — about 27 percent — toward the $12,680 annual cost for family coverage, according to the survey of 1,927 public and private companies by the Kaiser foundation and the Health Research & Educational Trust.

Workers with single coverage pay about $721 a year, or about 16 percent of the $4,704 annual cost of their coverage.

Both rates are up about 5 percent from 2007, which is the slowest annual growth rate since the survey began in 1999.

However, soaring health-care costs continue to hurt employers and workers. The overall cost of family coverage has increased 119 percent since 1999; that's roughly four times faster than the rate of inflation — 29 percent — over the same period. It's more than three times faster than workers' earnings, which have increased 34 percent in the past nine years.

About 158 million people are covered by employer-sponsored health plans. Most large companies with more than 200 workers provide health coverage and 62 percent of smaller firms do. The majority of the nation's 46 million uninsured work for small businesses.

Information from The Associated Press is included in this report.