With open enrollment for health insurance getting underway in workplaces, odds are employees around Florida are seeing yet another increase in their premiums.
The good news is, premiums aren't going up as fast as they have in the past. Health News Florida Editor Julio Ochoa sat down with Sara Collins from The Commonwealth Fund to discuss her recent study about health insurance in the workplace.
Julio Ochoa: Most Americans who are over 65 get their health insurance through their employer. But the news this week has been about Obamacare premium increases. Does that have any effect on employer-based insurance plans?
Sara Collins: The employer-based market is very separate from the individual insurance market or the marketplaces. Very different risk pools. The majority of Americans get their health insurance through an employer. About 154 million people get health insurance through an employer and in contrast to that, about 10 million people get coverage through the marketplaces.
JO: Your study looked at insurance premiums in the workplace and they are increasing again, which should come as no surprise to the average worker. But the study says that they're growing at a slower rate. Tell us about that.
SC: So in the five years since the passage of the Affordable Care Act, the rate of increase in employer plans in Florida was about 2.7 percent and that's down significantly from the rate of increase prior to the Affordable Care Act when it was about 6.8 percent per year.
JO: The amount Floridians pay for deductibles has nearly doubled to 12 percent over the past five years. What's responsible for this increase?
SC: You know, we don't really know what is driving an increase like that and why Florida is so much different from the rest of the country on this measure. It is the case in Florida, in general, that the health plans, employer health plans, do tend to be a little less generous. And by that, I mean people contribute a little bit more of their premium than average and that's particularly the case for family plans. And they're also asked to pay a little bit more in terms of deductibles, and more people, about 90 percent of people in Florida and player plans have deductibles. So it is a characteristic of Florida plans that comes out in these data.
JO: Your study also says the average Florida family spends about 13 percent of their paycheck on insurance premiums and deductibles. How does that compare to five years ago?
SC: That is up from 2006 when out-of-pocket costs for premiums and deductible comprised about 8 percent of income in Florida. So we've been seeing growth in that cost burden and over time nationally and we're definitely seeing it in Florida.
JO: And yet, as you said, the median income in Florida has remained relatively stagnant. What's that mean, can you tell us, for the average worker who's watched their premiums increase.
SC: It means that people are feeling pinched by health care costs increasingly every year and in Florida, which has seen an uptick in the size of deductibles, it means that their incomes aren't going up but their costs are actually rising. So it has to feel painful for people particularly who are in the middle range of the income distribution and the concern obviously, and we know from our data when people face high deductibles relative to their income they are just less likely to get health care that they need.
JO: What's the answer to these rising costs?
SC: First and foremost, premiums are driven by medical costs. So to the extent that the rate of growth in health care costs slows or increases you tend to see that reflected in the rate of growth in premiums, and we've seen a slowdown in health care costs nationally, and so we've seen a slowdown in the rate of growth in overall premiums. And the same is true in Florida. What also matters is the extent to which employers share those costs with their employees.