- The Washington Times - Tuesday, August 20, 2013

The cost of employer-based health plans grew modestly since last year, though still faster than wages and the general inflation rate, according to a new national survey that indicates that health care costs may be moderating as debate about the impact of President Obama’s health care law rages.

Annual premiums grew 4 percent from 2012, to reach an average cost of $16,351 for a family plan, with the worker’s contribution slightly more than a quarter of the cost, according to a Henry J. Kaiser Family Foundation survey of 2,000 employers.

Premiums for individuals rose 5 percent, to reach $5,884.


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Surveyors said the rate increases are moderate by historical stands, because premiums have risen about 80 percent since 2003.

“The critics of Obamacare will have a much harder time blaming big premium increase in employer insurance on Obamacare this year, because there aren’t any big premium increases,” Kaiser CEO Drew Altman said.

But a Kaiser tracking poll found few people realized their premiums were increasing at a slower rate, likely because wages only increased by 1.8 percent and inflation increased by 1.1 percent from 2012 to 2013.

The primary reason for slowing health costs has been the subject of debate. There is evidence the recession played a role, while others say restrictions within Mr. Obama’s Affordable Care Act have helped tamp down costs.

Most of the reforms that affect employer-sponsored health plans will take effect in 2014, including changes in coverage and rating rules for small-group insurance and the rollout of Small Business Health Options Program (SHOP) exchanges for small employers.

Surveyors found that 36 percent of covered workers are in “grandfathered” plans under the health care law, down from 48 percent last year, so a growing number of employees will be exposed to the reforms enacted in 2010.

The relatively slow rate of growth in costs also means fewer plans will be subject to a special tax on high-cost “Cadillac” plans, which takes effect in 2018, the journal Health Affairs said in its breakdown of key findings.

According to Kaiser, 149 million non-elderly Americans are covered by employer-based plans. Notably, the survey found lower-wage workers tended to shell out more in worker contributions for their coverage than workers at higher-wage firms did.

“This underscores how much, sometimes, lower-wage workers struggle,” said Gary Claxton, a vice president at Kaiser. “Even when they’re offered health insurance, they sometimes have to pay quite a bit for it relative to people who make more money.”

More than half of all firms, at 57 percent, offered health benefits to at least some of their employees, which the surveyors said is “statistically unchanged” from last year’s 61 percent.

The survey found that 93 percent of firms with 50 or more full-time workers offered health insurance, although all of them will be required to provide adequate coverage or face fines under the health care law’s “employer mandate,” which the Obama administration delayed by one year, to 2015.

The administration says other parts of the law will go into effect as scheduled — including enrollment this October in state-based health exchanges, where Americans without employer-based coverage can buy plans with the help of government subsidies.

Opponents of the law have pointed to various states where proposed rates on the individual market have gone up, not down, to buttress their case for dismantling the overhaul.

The law’s “individual mandate” requiring most Americans to obtain some form of health coverage will take effect in 2014, which coincides with the expansion of Medicaid enrollment in states that chose to extend the federal-state entitlement to residents making up to 138 percent of the federal poverty level.