The cost of workplace health insurance premiums rose more slowly in Kentucky and the nation in recent years, but ate up a greater share of people’s income because pay raises didn’t keep pace, according to a report released Wednesday.
Premiums for a family plan in Kentucky went up an average of 7.9 percent a year from 2006 through 2010 but only 4.5 percent a year from 2010 to 2015, researchers for The Commonwealth Fund found.
However, the amount Kentucky families spent on premiums and deductibles amounted to an average of 10.4 percent of their income in 2015, up from 6.4 percent in 2006, the report said.
That 2015 figure was slightly above the U.S. average of 10.1 percent, up from 6.5 percent in 2006, the report said.
Sara Collins, a vice president at the fund and lead author of the report, said it was good news that premiums in employer plans grew more slowly in recent years.
“Unfortunately, many employees with moderate incomes aren’t feeling the benefits of these slowdowns because they haven’t yet experienced the sustained growth in their income needed to keep up with health costs,” Collins said in a news release.
The Commonwealth Fund is a New-York based foundation that supports research on health care issues.
The goal of the study released Wednesday was to compare growth in the cost of employer-sponsored health insurance before and after the 2010 start of the federal Affordable Care Act, commonly called Obamacare.
The study said there was some concern that the mandates of the law — such as requiring plans to cover preventive care without cost-sharing — would cause companies to drop employer-sponsored coverage, but that hasn’t happened.
There has been little change in the share of the non-elderly population covered under employer health plans, supporting a conclusion that companies have “relatively easily” absorbed the requirements, the study said.
The report said that in 2015, 57 percent of U.S. residents under age 65 had insurance through their job or a family member’s job, while 11 million were covered under plans through the exchanges set up under the law.
The study also found that premium costs have gone up more slowly since the law took effect than in the five years before.
Nationwide, the cost of a family policy went up an average of 5.1 percent annually before 2010 and 4.5 percent after. That likely reflects a drop in health care costs across the country, the study said.
Premiums still went up, however. The average employee cost of a single-person policy in Kentucky went up from $3,791 in 2006 to $5,984 in 2015.
The cost to employees for a family plan rose from $9,864 to $16,622 in that time, the report said. That was below the national average of $17,322.
Kentucky was one of eight states where premiums for single coverage continued to increase at a relatively high rate, however.
The average annual increase in Kentucky was 5.4 percent from 2006 to 2010 and only slowed to 5 percent a year since.
The findings show why many Americans with insurance see their health care costs as unaffordable because of premiums and deductibles taking a greater share of income, according to the authors.
The growth in the number of plans with deductibles, and the size of those employee contributions, is a particular issue.
In 2006, there were no states where the average deductible topped $1,000, but in 2015 every state but Hawaii had average deductibles higher than $1,000, the report said.
Collins said consumers need to understand their health plans, including that some services are excluded from deductibles, and check whether they are eligible for subsidies.
The slower growth in premiums for employer-sponsored insurance contrasts with the announcement of sharp increases in the cost of health plans under the exchanges set up under the Affordable Care Act.
In Kentucky, there will be fewer choices available and premiums will go up more than 20 percent, state Health and Family Services Cabinet Secretary Vickie Yates Brown Glisson said Tuesday in a news release.
That’s not happening because of the state’s switch to using the federally-run Healthcare.gov site for sign-ups, Glisson said, but is “merely the reality of the current volatility in insurance markets as insurers react to the burdensome requirements of the Affordable Care Act.”
Collins, The Commonwealth Fund researcher, said many plans offered through the exchanges have been less costly than those in the employer-sponsored market, raising a question on whether exchange plans were under-priced and are adjusting.
Compared to health plans in the exchanges, employer plans are in a mature market, with large and diverse membership that allows companies to spread and manage risk, Collins said.
Bill Estep: 606-678-4655, @billestep1