Premium Pressure: The Cost of Coverage Eases

Premiums for health insurance coverage continue to rise--but the pace has slowed.
by | December 2006

Premiums for health insurance coverage continue to rise--but the pace has slowed.

That's the main finding from a recent survey by the Kaiser Family Foundation of employer-based insurance rates. This year, for the first time since 2000, health care premiums averaged a growth rate of only 7.7 percent.

"No one should be celebrating too wildly," warns Drew E. Altman, the foundation's president. "Health care costs are still going up higher than wages and are still going up higher than inflation." Workers' earnings are up 3.8 percent this year, and the overall inflation rate is 3.5 percent.

The survey also found that the effect of premium inflation continues to take a toll on insurance coverage, with the number of employers offering coverage shrinking. Where 65 percent of all workers were covered by an employer-sponsored plan in 2001, only 59 percent are covered today.

Zach Patton | Executive Editor | zpatton@governing.com