Health Insurance Deductible Rise, Benefit Fall, Report Says

Dec. 21--The bad numbers went up and the good numbers went down in a new survey of health insurance benefits offered by employers throughout California.

Premiums climbed an average of about 8 percent this year with the share of those costs paid by businesses and their workers both on the rise, according to a California HealthCare Foundation report released last week. Deductibles rose. Benefits fell. And slightly fewer companies -- 69 percent compared to 73 percent in 2009 -- provided their workers with insurance.

The annual survey, based on interviews with 805 employee benefit managers, showed premiums have jumped 134 percent since 2002 and confirmed what Marian Mulkey of the foundation already knew.

"It's sobering every year to see these increases in premiums and decreases in benefits that really make you wonder how long we can continue with the type of healthcare coverage that we've got," said Mulkey, who oversees the survey.

Some of the data was surprising. The total average cost of employer-based premiums for individual coverage in California was $5,463 or $414 higher than the national average. But the average worker contribution was $725 a year, or about $60 a month, with employers picking up the rest.

About 24 percent of the companies paid the full premium for single coverage, according to the report.

At Ricoh Printing Systems America in Simi Valley, health insurance prices are rising 14 percent as part of a decadelong cycle of increases. But the company opted to absorb more of the burden, paying 70 percent of premiums, compared to 67 percent a year ago, said Melissa Kissane , human resources manager.

"We've already hit our employees as hard as we think we can," she said.

In the survey, even some of the costs that seem reasonable rose dramatically from 2009. Then, the average annual cost of premiums for individual coverage was $5,133. Workers contributed an annual average of $564.

The cost of family coverage was exponentially higher than individual coverage, according to this year's survey. The total average price of the coverage was $14,396 with workers paying about $3,632 of that cost.

A year ago, 6 percent of the employers -- a record number -- said they were likely to drop coverage in the next 12 months. The number of employers who continue to offer insurance dipped slightly last year in a decrease that may not be statistically significant and has remained relatively stable over the past several years, Mulkey said.

"I think the fact that we see a steady offer rate ... suggests people are hanging on to the employer-provided insurance model we've had in this country for many years," she said.

Ocean Ortho Management Corp., which runs a medical office in Ventura, saw its premiums rise 16 percent starting in November while its insurance benefits decreased. The company shouldered some of that increase but also asked employees to pay 20 percent of the total premium cost, compared to 10 percent last year.

"I think because of the way the economy is right now, we're feeling it more than we ever have," said office manager Tracy Ward , who doesn't see things changing soon. "Not in the near future. I hope that it does... It would be nice to see the pendulum swing the other way."

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