Health insurance premiums have risen three times faster than incomes, according to a new Commonwealth Fund state-by-state analysis of employer coverage. In 2009, total premiums—including employee and employer contributions—equaled or exceeded 18 percent of the median household income in 26 states, up from three states in 2003.
The analysis of state trends from 2003 to 2009 finds family coverage in employer-sponsored health plans increased 41 percent across states, ranging from a 21 percent increase in Delaware to a 59 percent increase in Louisiana. The report found that by 2009, premiums were highest in Alaska, Connecticut, Massachusetts, Vermont, Wisconsin, and Wyoming, with family premiums in those states exceeding $14,000 a year. Annual family premiums in the lowest-cost states—Alabama, Arkansas, Hawaii, Idaho, Kansas, Montana, North Dakota, Ohio, Oklahoma, South Dakota, and Utah—were also high, ranging from $11,000 to $12,000 per year by 2009.
Cost pressures on businesses and working families were particularly acute in Southern and South-Central states, where premiums are often high yet incomes are lower than the national average.
At the same time, deductibles rose sharply in almost all states, increasing an average of 77 percent from 2003 to 2009 in large and small businesses. In addition, more workers were paying deductibles—74 percent faced a deductible in 2009, compared with 52 percent in 2003.
The authors say many provisions in the Affordable Care Act offer the potential to reduce insurance cost growth while improving value and coverage.
Open the interactive map at left to see premium increases by state and read the complete issue brief for more detail.