Each year, the California Health Care Foundation (CHCF) examines trends in employer health benefits in the state of California. Last year, I reported on the 2010 CHCF report and now I will examine the 2011 report.
Between 2010 and 2011, some things have remained the same. Healthcare premiums are far outpacing inflation over the medium run and California premiums remain higher than average. Workers at small California firms have to cover a large share of premiums and receive less generous insurance coverage (i.e., deductibles more than $1000).
High-wage firms (66% vs. 42%), firms with few part-time workers (70% vs. 41%) and firms with at least some unionized staff (84% vs. 61%) are more likely to offer health insurance to their workers.
Growth in California health insurance premiums (9.1%) in 2011 fell below the growth rate of the U.S. overall (9.5%). In 2010, the opposite was true. California health insurance premiums rose by 7.5%, but overall U.S. premium growth rose by only 3.0%.
The stereotype that California is the land of managed care holds true. Whereas the national proportion of covered workers enrolled in an HMO declined from 20% to 17% between 2009 and 2011, in California the proportion of covered workers enrolled in an HMO held steady at 54%. Also, although the U.S. overall has seen significant growth in high-deductible health plans (HDHPs) so that 17% of covered workers are enrolled in these plans, in California, only 6% of workers have enrolled in this plan type.
Is the ACA working? The answer is probably no. “Just 32% of small California firms not currently offering health benefits were aware of the small firm tax credit that is part of the Affordable Care Act.”
CHCF 2011 Employer Health Benefits Talking Points
- Since 2002, family premiums rose 153%, more than five times the 29% increase in California’s inflation rate. In 2010 family premiums also rose by five times inflation since 2002.
- The proportion of California employers offering coverage declined from 73% to 63% in the last two years.
- Annual premiums were higher in California than nationally for individual coverage ($5,970 versus $5,429) and family coverage ($15,724 versus $15,073).
- However, the employer contribution in California is significantly higher than the national average. Employers in California contributed $5,213 annually for single coverage and $11,921 for family coverage.
- Workers at small firms were much more likely to cover at least half of the premium for family coverage than workers at large firms.
- Workers at small firms with a deductible of $1,000 or more increased to 27% from just 7% in 2006.
- Twenty-five percent of California firms either reduced benefits or increased cost sharing for employees in thepast year, while 22% increased employees’ share of the premium (compared to 15% in 2010).
- thirty-six percent of California firms say they are “very” or “somewhat” likely to increase the amount workerspay for premiums in the coming year.
Source: CHCF “California Employer Health Benefits Survey.” December 2011.