A new survey conducted among over 20,000 health plans and over 11,000 employers of all sizes-representing over 2.5 million employees—reports that premium renewal rates for employer sponsored health insurance rose an average of 6.6% in 2017. According to the 2017 United Benefit Advisors (UBA) Health Plan Survey, this is a significant increase over the previous 5-year average of 5.6%.
Here’s a breakdown of average employer-sponsored premiums in 2017: Single coverage jumped from $508 in 2016 to $532 in 2017 (a 4.5% increase); family coverage rose from $1,236 to $1,272 (a 3% increase); and average annual total costs per employee rose from $9,727 to $9,935.
And employees absorbed most of the increases—their share of total costs rose 5% ($3,378 to $3,440) while employers bore an increase of less than 1% ($6,350 to $6,401).
In addition, the survey reports that Connecticut and New York saw record premium increases this year: 24% and 14%, respectively. The survey also had a few bright spots—at least for those in Arizona and Washington—as respondents from those states reported actual decreases in premiums of 2% and 10% respectively.
“Premiums have been holding relatively steady the last few years. And while this year’s increases are not astronomical, their departure from the trend does warrant attention. To mitigate these rising costs, employers are shifting more premium onto employees, offering more lower-cost consumer directed health plans (CDHPs) and health maintenance organization (HMO) plans, increasing out-of-network deductibles and out-of-pocket maximums, and leveraging continued extensions on the ability to ‘grandmother,'” Peter Weber, President of UBA, said in a press release announcing the survey results.
The survey covered much more, including increases in out-of-pocket costs, trends related to prescription drug plans, and employers using self-funding. An executive summary of the survey is available from UBA.