pinch bosses, employees
By Will Shanley, Staff Writer
Wednesday, September 27, 2006
In the past six years, health-insurance premiums have jumped 87
percent, more than four times the increases in wages and
consumer prices during that time, according to a nationwide
survey released Tuesday.
Family health coverage costs an average of $11,480 annually.
Workers pay $2,973 of that, which is $1,354 more than in 2000,
according to the 2006 Employer Health Benefits Survey from the
Kaiser Family Foundation and the Health Research and Educational
The study, done annually, was based on a telephone survey of
several thousand employers who responded. It found that about
61 percent of companies offer health benefits to at least some
workers, down from 69 percent in 2000.
Companies are passing additional costs on to workers or even
dropping coverage, the study showed.
Boulder-based Metzger Associates, which employs 12 people,
stopped offering comprehensive health insurance to workers three
years ago. Instead, the public-relations firm provides workers
with catastrophic health insurance and encourages them to take
out individual policies.
"There are other things that I want to offer as an employer,"
said John Metzger, founder and chief executive. "It's no longer
a blanket deal for us."
To make it up, Metzger said he offers workers sweeter salaries
and other perks. He said the approach doesn't save him a
significant amount of money, although he no longer worries about
filling out insurance forms and other administrative tasks.
Doyle Albee, a Metzger account director, said the setup "works
great from my selfish standpoint."
"It gives me flexibility that I wouldn't have had," said Albee,
43, who is insured through his wife's employer, a Boulder-based
Other companies are taking steps to combat the relentless rise
of insurance premiums, including offering discount health-club
memberships, providing healthier food options in cafeterias and
paying for smoking-cessation programs.
Yet "few employers have a lot of confidence in strategies to
contain rising health-care costs," the report stated.
Average insurance premiums for people covered through
employer-sponsored health-care plans jumped by 7.7 percent this
year. By comparison, the study said wages are up 3.8 percent
this year and inflation is 3.5 percent.
Nonetheless, the 7.7 percent hike is the lowest since 2000, the
The apparent slowdown in premium increases is due to a decline
in hospital visits as well as workers paying higher deductibles
and co-payments when receiving treatment, said Jim Hertel,
publisher of the Colorado Managed Care newsletter.
"The whole health-insurance (expense) is taking a bite out of
American household budgets -- at least I know it is for our
family," said Paul Worden, 46, of Aurora. "You are paying more
at the doctor, and you are paying more at (the pharmacy)."
Worden, who works in information technology at Qwest, said he
paid about 15 percent more this year for health-care coverage.
He said that his family has cut back other spending as a
result. For example, they'll forgo high-end restaurants and
dine on fast food instead.
"We didn't get raises last year, so it ends up coming out of our
entertainment budget," said Worden, whose insurance covers his
wife and two children, ages 2 and 4.
Monica Ford, 42, of Denver said health-insurance premiums have
doubled within the past six years -- but were up just slightly
"It didn't go up so much that it made me complain," said Ford,
who handles back-office tasks for a data-research company.
Other notable findings from the study include:
- Workers at firms with 199 employees or fewer paid $3,550 for
family coverage, compared with $2,658 for family coverage at
- Workers enrolled in consumer-driven health care -- akin to a
401(k) saving accounts for medical costs -- remained unchanged
at 4 percent of covered workers, or 2.7 million people
Staff writer Will Shanley
can be reached at 303-954-1260 or