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Premiums for Employer-Sponsored Family Insurance Increased 5% in 2018

Jaime Rosenberg
According to the 2018 benchmark Kaiser Family Foundation Employer Health Benefits Survey, annual premiums for family and single coverage have increased in 2018 and the burden of deductibles continues to grow on employees. However, as premiums rise, so does employer investment in health and wellness programs for their employees. 
Employer-sponsored insurance covers half of the nonelderly population, accounting for approximately 152 million people. This year, the annual family premiums for employer-sponsored health insurance rose 5%, averaging $19,616, and the annual premiums for single coverage increased 3%, averaging $6896, according to the 2018 benchmark Kaiser Family Foundation Employer Health Benefits Survey.

On average, employees are contributing $5547 toward family coverage and $1186 toward single coverage, with the employer picking up the rest. Premiums for both family and single coverage are highest in the Northeast than in other regions.  

According to the survey of nearly 2200 employers, the increase is comparable to the increase in workers’ wages (2.6%) and inflation (2.5%). However, over the past 10 years, average family premiums have increased by 55%, twice as fast as wages (26%) and 3 times as fast as inflation (17%). The survey also found that the burden of deductibles on employees continues to grow, with an increasing share of covered employees facing a general annual deductible and the average deductible rising for those who face one.

“Health costs don’t rise in a vacuum,” Drew Altman, president and chief operating officer, Kaiser Family Foundation, said in a statement. “As long as out-of-pocket costs for deductibles, drugs, surprise bills, and more continue to outpace wage growth, people will be frustrated by their medical bills and see health costs as huge pocketbook and political issues.”

Small firms (3 to 199 workers) and large firms (200 or more workers) have similar average premiums for single coverage, and while employees have a lower average premium for family coverage ($18,739 vs $19,972), employees at smaller firms contribute a higher average percentage of the premium for the coverage (38% vs 26%).

Preferred provider organization plans continue to be the most popular plan type, accounting for nearly half (49%) of covered employees this year, followed by high-deductible plans with a savings options, accounting for 29%.

In addition to the 57% of employers that offer health benefits, many are investing in health and wellness programs for their employees. “Firms continue to show considerable interest in programs that help workers identify health issues and manage chronic conditions,” according to the report. “Many employers believe that improving the health of their workers and their family members can improve morale and productivity, and reduce healthcare costs.”

Offerings include health screening programs, such as health risk assessments that inquire about lifestyle, stress, or physical health, and biometric screening—an in-person health assessment by a medical professional. One in 5 (21%) large employers collect information from employees’ mobile apps and wearable devices, including Fitbits and Apple Watches, as part of their wellness or health promotion programs, up from 14% last year.

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