The Homa Files

Recently, a friend casually mentioned to me that his family finances were being strained by healthcare costs.

Why?

His family’s annual deductible had gone up from $2,500 to $12,500.

What?

Think about that for a moment … a 10-grand bump in out-of-pocket healthcare costs before the insurance even kicked in (with co-pays, of course).

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The discussion piqued my curiosity, and I did some digging to put my friend’s predicament in perspective … what I found was surprising (and certainly under-reported in the main stream media)

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Every year, the Kaiser Family Foundation does a comprehensive survey of healthcare costs.

The latest is the 2014 Kaiser Report.

Here are some highlights (or lowlights, depending on your perspective).

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In 2014, the average employer-provided family health insurance policy cost almost $17,000 …. an increase of about 27% since 2009 (the last pre-ObamaCare year).

Note: Approximately 60% of Americans are covered by employer-provided plans

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In 2014, the employee-paid part of of the average family health insurance policy was $4,823 … that’s about 29% of the total premium amount.  The rest is paid by employers.

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The employee-paid part of of the average family health insurance policy has been steadily increasing … but note the step-up when ObamaCare was passed.

One explanation: in effect, employers passed along the bulk of the added costs of mandated coverage increases to employees.

Bottom line: employees are paying about $1,300 more annual for their family’s health insurance since ObamaCare was enacted … an increase of almost 40%.

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Employees and employers are sharing health insurance premiums at roughly historical rates … i.e. after the 2010 step-up to absorb ObamaCare coverage mandates, the rate has remained flat.

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The portion of workers with annual deductibles — what consumers must pay before insurance kicks in — rose from 55% eight years ago to 80% today.  That is, about half of families who didn’t have deductibles before, now have them.

About half of the employees who now have deductibles,  have deductibles over $1,000 … half of them (about 20% of the total) have deductibles greater than $2,000.

On average, family plan deductibles are now about $2,500 … about double what they were pre-IbamaCare.

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Putting just those two pieces together — the increased employee-paid part of premiums and the increased deductibles — means that an average family covered by an employer plan is now paying about $2,500 MORE out-of-pocket for healthcare than they did pre-ObamaCare … a $5,000 difference versus the promise of a $2,500 cut.

And, that doesn’t even consider co-pays — which have roughly doubled on average, direct tax increases, and indirect tax increases (e.g. on medical devices).

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My friend’s case of a $10,000 bump in his deductible may be an outlier … but, directionally indicative.

Lots of chatter about helping the middle class.

Looks like this one moves in the wrong direction.

Rich folks can absorb the increases without breaking a sweat.

Poor folks get covered with subsides.

It’s the folks in the middle that get hammered.

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This entry was posted on August 18, 2015 at 6:59 am and is filed under Health Care / Medical Insurance, Healthcare Economics, ObamACA, ObamaCare. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.