Health insurance costs for workers rose 4% during pandemic

·1 min read

Health insurance provided by employers this year cost an average of $22,200 for families and $7,700 for individuals, a 4% increase from a year ago, according to new survey data from the Kaiser Family Foundation.

Why it matters: While many people lost their jobs and health insurance during the pandemic, most companies didn't rock the boat heading into 2021. But even a relatively modest increase in the already high costs of job-based insurance means workers and families continue to pay a lot more for their health care.

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The big picture: The 4% increase in health insurance premiums was the same as last year, but it still outpaced inflation, according to KFF.

  • Premiums almost always rise faster than the growth in workers' wages, but that gap went away for this year.

  • However, any gains in people's paychecks were still completely offset by higher insurance costs.

By the numbers: 155 million people get their health coverage from an employer plan.

  • Employers are still paying for almost 75% of the premiums, a cost that is mostly invisible to workers except if they notice it on tax forms.

  • People who work at smaller companies continue to shoulder higher percentages of their premiums and have higher deductibles and out-of-pocket costs, according to the survey data.

The bottom line: "Despite pandemic uncertainties in the labor market and health care use, employer health benefit programs have not experienced big changes," KFF analysts wrote in an accompanying article in Health Affairs.

  • But employer coverage remains expensive because of the high prices coming from hospitals, doctors, drug companies, and other health care entities.

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