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New Survey Shows 9.2 Percent Rise in Health Insurance Premiums in 2005

Thursday, September 15, 2005

(American Meat Institute)Health insurance premiums paid by employers increased an average of 9.2% in 2005, according to the 2005 Annual Employer Health Benefits Survey just released by the Kaiser Family Foundation and Health Research and Educational Trust.

The 2005 increase ended four consecutive years of double-digit increases, but the rate of growth is still more than three times the growth in workers’ earnings (2.7%) and two-and-a-half times the rate of inflation (3.5%). Since 2000, premiums have gone up 73%.

The survey found that three in five firms (60%) offered coverage to workers in 2005, down significantly from 69% in 2000 and 66% in 2003. The drop stems almost entirely from fewer small businesses offering health benefits, as nearly all businesses (98%) with 200 or more workers offer such benefits.

Of the firms that do not offer health benefits to their workers – the overwhelming majority of whom are small firms – most cited cost as a key factor. Nearly three in four (73%) said high premiums were “very important” to their decision. In comparison, just over half (52%) said their firm’s small size and one in three (33%) said the fact that their workers had access to other coverage were very important to their decision.

For more information about the survey, go to: http://www.kff.org/insurance/chcm091405nr.cfm

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