'Calm Before The Storm': Health Insurance Costs Set To Spike After They Stayed Mostly Flat In 2022, Survey Finds

The cost of family health insurance plans rose just 1% this year, despite the fact that inflation has been rising for four decades, driving up the price of gas, groceries, rent and other living expenses.

The average cost of an employer-provided family health plan is $22,463 this year, up $242 from last year, according to the Kaiser Family Foundation's Employer Health Benefits Survey released this week. Employers cover the vast majority of health insurance premiums for the approximately 159 million Americans who receive insurance through their workplace; For the family package this year, workers will pay $6,106, usually through payroll deductions.

Officials warn that there could be significant price increases in 2023 as inflation hits the health care industry and hospitals, doctors and pharmaceutical companies demand more preferential payments from insurance companies and employers.

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Drew Altman, president and CEO of the Kaiser Family Foundation, said current prices may be "the calm before the storm as recent inflation suggests more growth is ahead."

Everything else is more expensive. Why are health insurance rates fixed?

According to Gary Claxton, Kaiser's vice president and project director for health markets, health insurance premiums this year were set a year ago, before the rise in inflation.

Claxton said the healthcare industry is also grappling with the effects of the coronavirus pandemic. People are postponing doctor and hospital visits in 2020 when COVID-19 hits, so insurance companies are spending less money on elective treatments and non-emergency surgeries. In the same year, the insurance company's profit doubled.

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"The insurance companies are still making money," Claxton said. "It doesn't look like they were struggling and really needed a premium increase."

With inflation at 8% this year, the highest since the early 1980s, employers and consumers could face a higher-than-average increase in insurance premiums next year, according to the Kaiser report. Other analysts agree with this. Segal Benefits Consulting Projects Health insurance costs will rise 7.4% next year as employers and consumers foot the bills of doctors, hospitals and pharmaceutical companies.

In a tough labor market, employers don't want to pay workers more

Large companies are self-funded and pay their employees' medical expenses directly, even if the program is managed by private health insurance. Some companies do not want to force their employees to pay higher premiums or impose higher deductibles on them.

Kaiser said the average reduction per capita was $1,763, up from $1,669 last year. People must pay this amount out of their own funds before coverage begins.

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"As the year comes to a close, we continue to face challenges in the labor market," Claxton said. "Hiring employees is expensive (and) firing your current employees is not a good idea."

But Claxton said as employers shoulder higher medical costs and the job market shrinks, employers may be more willing to raise and lower premiums.

Employees of companies with fewer than 200 employees must pay the majority of their medical expenses. Typical deductions for a small business are over $2,500, which is about $1,000 more than for a large business.

Nearly half of Americans have medical debt

Other polls show that Americans are struggling to pay for Medicare as the daily cost of living rises. According to a survey published this week by the telemedicine company Babylon, about 46% of people say that their medical bills have led to debt.

About 1 in 3 people struggle to pay for routine or emergency care and private health insurance. People between the ages of 25 and 34 are struggling to pay for Medicare. According to a survey of 5,000 adults conducted in August, more than half of young people can hardly afford private health insurance.

A survey last month by the Commonwealth Fund found that 42 percent of Americans with health insurance have trouble paying medical bills or past medical debt. In addition, 46% of working-age adults missed or delayed treatment in the past year because of the cost.

However, a Commonwealth Fund report says that those who have health insurance from an employer have stronger coverage than those who buy their own health insurance.

The Mental Health Network has failed

Employers are also paying more attention to the mental health needs of their employees in the wake of the coronavirus pandemic.

The Kaiser survey found that nearly half of large employers reported that more employees are using mental health services. Almost one in three reported that more workers are taking family leave for mental health care.

But the study also shows that a chronic shortage of mental health workers prevents workers from accessing counselors or other professionals. About 30% of large employers say they do not have enough doctors or behavioral health counselors in their network to provide timely help to workers. The gap persists even as more than 1 in 4 large companies are expanding their network of in-person and remote mental health providers.

Ken Oltaker is on Twitter at @kalltucker or can be emailed at alltuck@usatoday.com.

This article was originally published in USA TODAY. "Calm before the storm". Health insurance costs will rise through 2022 after remaining largely flat, according to the survey.

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