2023 Premiums for Employer-Sponsored Health Insurance Increased 7%, KFF Survey Finds

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The average annual premium for employer-sponsored single and family coverage increased by 7% in 2023, an increase from 2022, but roughly in line with the rate of inflation (5.8%) and wage growth (5.2%), according to the annual KFF Employer Health Benefits Survey.

The survey, which was completed by 2,133 firms, showed that the average annual premium for single coverage was $8,435 and for family coverage, $23,968. Workers, on average, covered 17% of single coverage ($1,401 of $8,435) and 29% of family coverage ($6,575 of $23,968). The average worker contribution for family coverage was considerably higher ($8,334, or 38% of the premium vs. $5,889, or 25%) for workers employed by small firms (3-199 employees) than for those working for large ones (200 or more employee). There wasn’t much difference between small and large firms when it came single coverage, the survey found.

The 7% premium increase is larger than the 2% increase for single coverage in 2022 and the 1% increase in premiums for family coverage. However, 2022 was an outlier because the premiums that year reflected the decrease in utilization of healthcare services in the previous years due to the COVID-19 pandemic

First author Gary Claxton, senior vice president, the director of the Program on the Health Care Marketplace, and his colleagues, noted that increases in health insurance premiums have typically outpaced inflation and wage growth. During the past 10 years, for example, the average family premium has increased by 47% compared with a 30% increase in inflation and 42% increase in wages. But in the past five years, the 22% growth in the average family premium has been closer to the 21% growth in inflation and lower than the 27% increase in wage growth.

This is the 25th year that KFF, formerly known as the Kaiser Family Foundation, has conducted the survey. The response rate to the survey which was fielded from January to July of this year, was 15%, which is similar to the response rate the past two years.

Claxton and his colleagues reported the results of the survey in a Health Affairs article that was published this morning.

Here are some other findings from the survey:

• Almost half (47%) of covered workers are enrolled in a preferred provider organization plan this year and just under one-third (29%) are enrolled in a high-deductible plan with a savings options.
• Almost two-thirds (65%) of workers are enrolled in a self-funded plan. Large firms are more likely to have the resources to self-insure than small ones, and the KFF survey results show that. Workers for a large employers this year are more likely than workers for small ones to be covered by a self-funded plan (83% vs. 18%).
• Almost two-thirds (63%) of workers have coverage with a deductible of $1,000 and approximately one-third (31%) have coverage with a $2,000 deductible.
• The average copayment for a primary care visits for covered workers this year is $26 and for a specialist visit, $44.
• The majority (91%) of employers said that their largest plan had enough primary care providers in its network to provide access to services to workers in a timely. But when it came to mental health providers, 68% of small firms and 59% of large firms indicated that they believe there were enough providers in the plan’s network to provide timely access.
• Most employers(91% of those with 50 or more worker) are covering telehealth services, and most (59%) do so through their health plan. Only 20% use a specialized telehealth service provider.