Average Cost For Health Insurance Through Employer

Average Cost For Health Insurance Through Employer – Employer-sponsored insurance covers about 153 million people1. It conducts an annual survey of private and non-federal employers with three or more employees to provide a current snapshot of employer-sponsored health benefits. It reflects the 25th Employer Health Benefits Survey (EHBS) and employer-sponsored health benefits in 2023. The survey was conducted between January and July 2023.

The average annual premium for employer-sponsored health insurance in 2023 is $8,435, and $23,968 for family coverage. The average annual single premium and the average annual family premium increased by 7% compared to last year. In comparison, workers’ wages were up 5.2% and inflation was 5.8%2. Average and single family premiums increased faster than last year (2% to 7% and 1% to 7%).

Average Cost For Health Insurance Through Employer

Average premiums for family coverage have increased by 22% over the past five years, while workers’ wages have increased by 27% and inflation by 21% [Figure A].

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Per coverage, the average premium for covered workers is higher in small firms than in large firms ($8,722 vs. $8,321). Average premiums for family coverage are similar for employees at small and large companies ($23,621 to $24,104). Average premiums for employees covered in high-cost health plans with a savings option (HDHP/SO) are lower than the total premiums for single coverage ($7,753) and family coverage ($22,344). In contrast, average premiums for covered workers enrolled in PPOs were flat ($8,906) and higher than total premiums for family coverage ($25,228). The average premium for single coverage is lower in private for-profit companies ($8,078) than for employees ($8,771) or in non-profit companies ($9,023). Average premiums for employees in companies with a relatively high proportion of older workers (at least 35% of employees are aged 50 or over) are higher than average premiums for employees in companies with smaller proportions of older workers. single coverage ($8,790 to $8,112) and family coverage ($24,700 to $23,304).

Figure B: Average Employee and Employer Annual Premium Contributions for Single and Family Coverage, by Plan Type, 2023

Most indoor workers contribute to the premium cost of the provision. On average, employees contribute 17% of the premium for single coverage and 29% of the premium for family coverage, similar to the percentages covered in 2022. Employees in smaller companies contribute, on average, a higher share of premiums for families. compared to large companies (38% compared to 25%). As a result, the average tax amount for covered employees in small companies ($8,334) is significantly higher than the average contribution amount for salaried employees in large companies ($5,889).

Covered employees in private, non-profit companies have relatively high premium tax rates for single coverage (19%). The premium contributions of covered employees in public institutions are relatively low (13%) and family (24%).

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Thirty percent of covered employees in small companies are enrolled in a plan where the employer pays the entire premium for one cover. This is only for 6% of employees in large companies. However, 32% of supply workers in small companies have to contribute more than half of the premiums for family provision in the scheme, compared to 8% of supply workers in large companies.

The average annual dollar amount contributed by covered employees in 2023 is $401 for single coverage and $6,575 for family coverage, similar to last year’s amount but higher than five years ago. 11 percent of covered workers, including 25 percent of covered workers at small companies, are in plans with 12,000,000 or more in employee contributions. Single and family premium contributions for employees covered by HDHP/SO plans are, on average, lower than contributions for employees in other types of plans.

Figure D: Percentage distribution of premiums paid by cover workers for single and family coverage, by company size, 2023

PPOs are still the most common type of plan. In 2023, 47% of covered workers were enrolled in a PPO, 29% with a savings option (HDHP/SO), 13% in an HMO, 10% in a POS, and 1% in a POS. conventional plan (also known as compensation) [Figure E]. This distribution of supply workers by scheme type is similar to the distribution of supply workers by scheme type in recent years.

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Figure E: Health Plan Enrollment for Covered Employees by Plan Type and Company Size, 2018 and 2023

Many companies – especially large companies – are self-funded, meaning they pay for health care services for their employees out of their own money rather than by purchasing health insurance. Sixty-five percent of covered workers, including 18% of covered workers in small companies and 83% in large companies, are enrolled in self-funding schemes. The percentage of employees covered by self-funding schemes in 2023 is the same as last year.

Thirty-four percent of small companies that offer health benefits report having a funded plan, a similar percentage in 2022. and shifting much of the risk to insurers. These plans can have a meaningful impact on competition in the small group market because, unlike uninsured plans, they use health status as a rating and underwriting factor and do not require all the health benefits mandated by other plans.

Ninety per cent of those with single coverage have a total annual payment that must be paid before most services are covered under the plan, which is similar to last year’s percentage (88 %).

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In 2023, the average deductible for employees with uniform coverage and a total annual deductible is $735, the same as last year. The average deductible for covered employees is much higher at smaller companies than at larger companies ($2,434 to $1,478). Among employees with single coverage and any deductible, the average deductible has increased by 10% over the past five years and 53% over the past ten years.

In 2023, among workers with single coverage, 47% of workers at small companies and 25% of workers at large companies will earn an annual total of $2,000,000 or more. Over the past five years, the number of covered workers with an annual total of $2,000 or more increased from 26% to 31% [Figure F].

Some employee health plans also accept contributions to employer pooled accounts with high deductibles. These contributions can be used to reduce cost sharing amounts. Seven percent of employees covered by an HDHP with a health care organization (HRA) and 4 percent of employees covered by a qualified HDHP in a Health Savings Account (HSA) receive an account contribution for a lump sum that n greater than or equal to the deductible. amount Additionally, 34% of employees covered by HDHPs and 12% of employees covered by HSA-eligible HDHPs receive account contributions that, if excluded, would reduce their personal annual liability by less than $1,000.

Regardless of the plan, most covered workers pay a portion of the cost of visits to the doctor’s office. Most covered workers face a copay (a set dollar amount) for a doctor’s visit, but some workers have a copay (a percentage of the covered amount) instead. Average copay rates are $26 for primary care and $44 for specialty appointments, and average copay rates are 19% for primary care and 20% for specialty. These volumes are similar to 2022.

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Many workers also face additional cost sharing for hospitalization or outpatient surgery. Sixty-three percent of covered workers have coinsurance requirements, 10% copayments, and 8% copayments and hospital copayments. The average reimbursement rate for hospital admissions is 20%, and the average reimbursement is $404. The cost-sharing requirements for outpatient operations are similar to those for hospital admissions. However, the average fee for outpatient surgery is lower at $208.

Nine out of ten (93%) covered workers will have to pay for emergency room visits in 2023 in addition to their annual deductible. There is a copay and coinsurance requirement, whichever is greater. The average copay for an emergency room visit is $217, and the average copay is 21%. Turnover and average turnover rates for small firms are higher than for large firms.

Almost all of the employers in question have plans with an annual limit on in-network cost sharing (known as the out-of-pocket maximum), although these limits vary widely. Among employees covered in plans with out-of-pocket maximums for single coverage, 13% have an out-of-pocket limit of $2,000 or less, and 21% have an out-of-pocket limit of $2,000 or less.

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