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Survey: You'll pay more for your health insurance next year -- again Posted: October 25th, 2012

By Beth Orenstein

Beth Orenstein is a freelance writer. She holds a bachelor's degree in English from Tufts University.

Large U.S. companies and their employees saw their health care premiums rise by about 4.9 percent in 2012. That's down from the 8.5 percent jump they saw in 2011 and the 6.2 percent increase they saw in 2010, according to Aon Hewitt.

But brace yourself for next year. Aon Hewitt says employees could see their medical insurance premiums jump up to 6.3 percent in 2013. Its survey found that the average health care cost per employee will increase to $11,188 from $10,522 this year and $10,034 in 2011.

Employees are expected to continue to contribute 21 percent of the premium, the firm says. That means the average employee will pay $2,385 next year, up from $2,204 this year and $2,090 in 2011.

Employees' share of costs continue to rise

Employees also are expected to pay more for out-of-pocket health-care costs. The average employee out-of-pocket costs are expected to increase to $2,429 next year, Aon Hewitt says.

If Aon Hewitt's projections prove true, it means that employees' share of health-care costs will have increased more than 50 percent over the last five years -- from $3,199 in 2008 to $4,814 in 2013.

Employers were able to hold the line on premium increases in 2012 by being more aggressive with their benefit plans, Tim Nimmer, chief actuary at Aon Hewitt, said in a statement.

However, Nimmer says, Aon Hewitt expects premiums to gravitate back to the 6 percent range in 2013 as health-care costs continue to rise and more provisions of health reform kick in.

Type of plan, location could factor in

Aon Hewitt also forecasts:

  • Increases will vary by plan type. HMOs will see the highest increase -- 7 percent -- while preferred provider organizations (PPOs) and point-of-service (POS) should see increases of about 6 percent.
  • Increases could vary by location as they did in 2012. Areas that saw higher than the national average increases in 2012 included San Antonio (7.4 percent), San Francisco/Oakland/San Jose (7.4 percent), and Los Angeles (7.2 percent). Areas that saw lower than the national average increases included: Dallas (3.4 percent), Cincinnati (3.6 percent), Denver (4.5 percent), New York City (4.5 percent), Washington, D.C. (4.7 percent) and Philadelphia (4.9 percent).
  • More employers will offer strategies to encourage employees to consume less health care. Strategies include replacing co-pays with coinsurance, requiring the use of generic prescription drugs and mail-order refills for maintenance drugs, and charging extra for working spouses or additional dependents who could get their coverage elsewhere.

Aon Hewitt expects employers will continue to sponsor health insurance for their employees but encourage them to participate in wellness programs and provide incentives to stay healthy and take good care of themselves.