Released: September 27, 2006

No growth in high-deductible health policies

Source: By Julie Appleby, USA Today

High-deductible health insurance policies coupled with savings accounts — touted by proponents as an answer to rising medical costs — did not grow in popularity among employers this year, even as premiums for insurance continued to rise.

The Kaiser Family Foundation annual employer survey reported Tuesday that what employers paid for health insurance premiums rose 7.7% this year among all types of health insurance, the smallest increase since 1999, but more than twice general inflation.

Employers did not substantially raise deductibles or co-payments made by employees, or the employees’ share of premiums. Still, workers are paying more because the overall premiums rose.

“Working people are still feeling the pain,” says Drew Altman, president of the non-profit research group in Menlo Park, Calif.

The most common type of insurance, a preferred provider organization plan, averaged $11,765 for a family and $4,385 for single employees.

While high-deductible policies have always been sold, the new twist in the market came when Congress in late 2003 allowed certain policies to be coupled with tax-free “health savings accounts.” Money not used for deductibles and other medical care can roll over and be used in future years for medical care.

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