U.S. healthcare premiums to jump next year

This year U.S. companies and their employees saw the lowest health care premium rate increases in more than a decade. In 2014, however, average health care premium increases are projected to revert to the 6%-to-7% range, according to an analysis by Aon Hewitt.

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After plan design changes and vendor negotiations, the average health care premium rate increase for large employers in 2013 was 3.3%, down from 4.9% in 2012 and 8.5% in 2011.

Aon Hewitt’s analysis showed the average health care cost per employee was $10,471 in 2013, up from $10,131 in 2012. The portion of the total health care premium that employees were asked to contribute toward this premium cost was $2,303 in 2013, compared to $2,200 in 2012. Meanwhile, average employee out-of-pocket costs, such as copayments, coinsurance and deductibles, increased 12.8% ($2,239) in 2013, compared to just 6.2% in 2012 ($1,984).

For 2014, average health care costs are projected to increase to $11,176 per employee. Employees will be asked to contribute 22.4% of the total health care premium, which equates to $2,499 for 2014. Average employee out-of-pocket costs are expected to increase to $2,470.

These projections mean that over the last decade, employees’ share of health care costs—including employee contributions and out-of-pocket costs—will have increased almost 150% from $2,011 in 2004 to $4,969 in 2014.

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.