September 27, 2019
Despite employer efforts to reduce health care costs, the 2019 Kaiser survey of employer health benefits found the average cost of family coverage increased by 4.4% from 2018 to 2019, as the Affordable Care Act’s Cadillac tax is already negatively impacting employee benefits.
The survey details a number of steps employers are taking to reduce costs. While most media headlines focused on the cost of family coverage rising to $20,576, the report found:
Price increases are driving up costs: According to Cynthia Cox, vice president at the Kaiser Family Foundation, “if you look at what’s driving health-care costs year to year, it’s the price of health care: the cost of a doctor’s visit, the cost of a hospital stay. That’s really what’s making those premiums and deductibles go up each year.”
The ACA's Cadillac tax is having a negative impact on employer health benefits. A recent Kaiser Family Foundation analysis finds 21% of employers would be affected by the tax if it takes effect in 2022, and the 2019 survey found 33% of firms say the tax had an important impact on their health benefit decisions for the 2019 plan year.
Takeaway: The survey results are likely to be used by advocates for Medicare for All and a public option to raise questions about the ability of employers to quell rising health care costs in the U.S. Proponents of employer-based coverage will need to continue highlighting the innovative steps they take to reduce costs for employees, retirees, and their dependents.