Health insurance premiums increased by 8.2 percent in California in 2005, the first time in four years increases held to single digits, according to results from the 2005 California Employer Health Benefits Survey released December 1, 2005, by the California HealthCare Foundation (CHCF). However, the rise still outstripped the overall 3.9 percent statewide inflation rate.
Conducted by The Center for Studying Health System Change (HSC), the annual survey highlights statistics and trends specific to California and provides comparisons between the state and the nation. The survey is an offshoot of a national employer study conducted by the Kaiser Family Foundation and the Health Research and Educational Trust.
While the percentage of employers offering coverage has declined nationwide to 60 percent, a nine-point drop since 2000, the percentage of California employers providing health insurance (67 percent) remains relatively unchanged. As in previous surveys, firms cite the high cost of coverage as the primary reason they did not offer health benefits.
Looking to offset the cost of premiums, 38 percent of California's large employers (those with 200 or more workers) report they are very likely to increase the amount employees pay for health insurance in 2006. Thirty-two percent say they are somewhat likely to ask employees to pay more for coverage.
On average, California workers paid $41 per month for single coverage in 2005 and $240 for family coverage. Workers in lower-wage firms, by contrast, paid an average of $54 per month for single coverage and $302 for family coverage.
According to the survey, HMOs remain the least costly type of health plan in the state on average more than one-third less expensive than PPO plans for single coverage. But while HMOs in California cost less than the national average, PPOs are more expensive.
The decline in the pace of health care premium increases in California is encouraging. But premiums still increased twice as fast as inflation, offsetting the effect of wage increases and leaving too many Californians unable to afford coverage.
The results show that lower-wage workers are faring the worst in the employer-based health insurance system. Their employers are far less likely to offer health benefits, and when they do, workers have to pay more for coverage.