Released: September 26, 2006

Health insurance costs rise 7.7%

Increase is twice the rate of inflation

Source: By Julie Appleby, USA Today

Workers and employers won’t find much comfort in the smallest increase in health insurance costs since 1999. The 7.7% increase this year is still more than twice the rate of inflation. And those rising costs have so far failed to boost the percentage of employers offering what are touted by some, including President Bush, as an answer to health care inflation: high-deductible insurance policies coupled with savings accounts.

Despite being the biggest buzz among benefit consultants, the Kaiser Family Foundation says only 7% of employers offered such policies this year, unchanged from 2005. The results come from the non-profit foundation’s annual employer survey, released Tuesday.

“This shows that the debate in the media and in Washington health policy circles is way out in front of the reality,” says Drew Altman, president of the non-profit research group in Menlo Park, Calif.

Other results from the survey:

• Among all types of health insurance, what employers paid rose 7.7% this year, smallest increase since 1999, but still more than twice overall inflation.
• The most common type of insurance, a preferred provider organization plan, averaged $11,765 for a family and $4,385 for single employees.

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