Price of health insurance in Washington rose five times faster than state’s median income
Over the past decade, the cost of health insurance for families in Washington state rose more than five times faster than the median income in the state, according to a new study.
The study was conducted by Families USA, a health-care consumer group that advocates for health reform, and was based on data from the U.S. Census Bureau and the U.S. Department of Health and Human Services.
The report found that on average from 2000 to 2009, health insurance premiums for families in Washington rose from $6,496 to $13,857 a year—a $7,361, or 113.3, percent increase.
Over the same period, median earnings for workers in Washington rose far more slowly, from $26,761 to $32,530 a year—a $5,769, or 21.6 percent, increase.
That means the cost of family health insurance premiums rose 5.3 times faster than the median income of Washington workers.
Both employers and employees were hard hit by the cost increases of job-based coverage, the report found.
Over that decade, the share paid by employers for family coverage of their employees rose from $4,580 to $10,393 a year—a $5,813, or 126.9%, jump.
The share paid by employees rose from $1,916 to $3,464 a year—a $1,548, or 80.8 percent, increase.
Increases for job-based insurance for individuals also rose, from $2,740 to $4,681 a year—a $1,941, or 70.9 percent, increase.
The share paid by the employer for individual coverage rose from $2,455 to $4,078—a $1,623, or 66.1 percent, rise, while the share paid by employees rose from $285 to $604—a $319, or 111.9 percent increase.
In both cases, the increases in employees’ share far outstripped the increase in their income meaning that over the decade an increasing proportion of family budgets were consumed paying for healthcare.
The report argues that increase in healthcare costs can be blamed on:
- Rising healthcare spending due to the increase cost of treating chronic diseases, such as diabetes, and overuse of expensive technologies.
- Lack of consumer protections in the insurance market due to weak regulation on insurance companies allowing insurers to spend large amounts on administration and marketing and still reap generous profits.
- Too little competition between insurance companies giving them a near monopoly in the market.
- Cost-shifting due to the fact that those with insurance end up paying for the uncompensated care of those without insurance.
To learn more:
- Read the full report “Costly Coverage“, which is available on the FamiliesUSA Web site.
- For another view visit the the Washington Policy Center, a Washington state think tank that favors market solutions to healthcare costs, or go to our Resources and Support pages and scroll down to the “Health Policy” section, which lists local organizations involved in healthcare reform.
Category: Healthcare Reform
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It seems kind of odd that the title of this artcile refers to rising health insurance cost in Washington and then shows that the report links some of these costs to those reaping generous profits. However, the report was refering to the nation in general, but Washington’s largest health insurers are not-for-profit. It seems that this Seattle Times article is misrepresenting what is stated in the report.
It’s also not suprising that the report fails to cite one of the largest drivers of health insurance costs; personal health accountability. Much of the “chronic diseases” in this report can be linked to personal behavior. Many middle class Americans spend more money on eating out than they do on their health insurance. As we continue to subsidize unhealthy behavior, of course health care costs are going rise.
Finaly, anyone who has a job that can’t afford health insurance made decisions that put them in that position. The problem won’t be fixed by entitling them to something paid for through others’ responsible behavior.
Good point. It is confusing because the report is addressing both state and national trends for health insurance coverage cost and incomes.
But since not all insurers the state are not-for-profit, insurance company profits may well be a factor, though perhaps less than in Washington than other states.
As for the charge that the story misrepresents what the report says, here is the exact text from the report in its section on Washington state:
So, while many may disagree with the report’s view — Families USA, as the story noted, does advocate from health reform — the reporting is accurate in representing that view.
Michael McCarthy
Editor