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New Kaiser Survey on Employer Health Coverage Released

The Kaiser Family Foundation (KFF) released its 2021 Employer Health Benefits Survey on November 10. The results provide an important glimpse into what is happening to employer-sponsored health insurance around the U.S.  Overall, Kaiser surveyed 1,686 non-federal public and private organizations with three or more employees, and from this number, 523 employers were located in 12 Midwestern states (an average of 44 employers per state). The Kaiser study does not break out the results by each state, only by region.

Unlike the results found in the 2020 survey, this year’s survey provides a much better representation of how employer-sponsored health insurance has changed since the COVID-19 pandemic began in March 2020. Additionally, KFF revised the 2021 survey to reflect changes employers and health plans made to address potential issues and uncertainties arising from the pandemic. The survey took place from mid-January through July of this year.

Key Findings by Kaiser

The Kaiser survey is very helpful because it documents national health trends for employer-sponsored plans. Some of the key findings in 2021 include the following:

  • About 59 percent of employers offer health benefits, a percentage much like the previous year. Similar to Iowa, the larger the employer, the more likely health benefits are offered. About half (49 percent) of U.S. organizations with 3 – 9 employees offer health coverage, and nearly all (99 percent) of the organizations surveyed by Kaiser with at least 200 employees offer health coverage.
  • The average single and family premiums increased by four percent over the past year, while worker’s wages increased by 5 percent and inflation increased by 1.9 percent.
  • The average annual premium for single health coverage is now $7,739 ($7,470 last year), while the average family health premium is at $22,221 ($21,342). Over the last five years, the family premium has increased over 22 percent, and over the last 10 years, it has increased 47 percent.
  • On average, covered workers contribute 17 percent of the total single coverage premium ($1,299 annual) and 28 percent of the premium for family coverage ($5,969 annual). In our 2019 Iowa study, we found that covered workers contributed 18.6 percent for single coverage while workers for family coverage contributed 30 percent of the premium.
  • The average single deductible found by Kaiser now stands at $1,669, which is remarkably similar to last year’s $1,644 average. In 2021, 85 percent of covered workers have a deductible in their plan, similar to last year (83 percent).
  • Fifty-eight percent of small firms and 83 percent of large organizations address health risks and unhealthy behaviors by offering a wellness or health promotion program in at least one of these areas: smoking cessation, weight management, and behavioral or lifestyle coaching.
  • Telemedicine, which includes video chats and remote monitoring, continues to be very popular. In 2021, 95 percent of organizations with 50 or more employees that offer health insurance cover some healthcare services through telemedicine in their largest health plan, up from 67 percent three years ago.
  • Organizations with at least 50 employees were asked about changes they made to their health plans (after COVID-19 began) regarding mental health coverage for their employees. The results:
    • 31 percent expanded ways through which enrollees could get mental health or substance abuse services – such as telemedicine.
    • 16 percent developed new resources, such as employee assistance programs.
    • Six percent expanded the number of mental health or substance abuse providers in their plans’ networks.
    • Four percent waived or reduced cost-sharing for mental health or substance abuse services.
  • Health Care Price Transparency – Health insurance plans, including self-funded employers, will be required to make information available to enrollees about the estimated cost of services and cost sharing on a “real-time” basis. Twenty-six percent of large employers believe that providing employees with additional information about the cost of services will help their healthcare decision-making “a great deal” and an additional 50 percent responded that it will help their decision-making “somewhat.” Only three percent of large employers say the new transparency rules will reduce health spending “a great deal,” while 15 percent said they will reduce health spending “not at all.” Thirty-eight percent believe the new rules will reduce spending “somewhat” and 40 percent responded that spending will reduce by “very little.”

The Kaiser study was published in the peer-reviewed journal Health Affairs.

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