Health care for workers

On this Labor Day, how is healthcare evolving for workers and firms? First, healthcare spending is on the rise, with costs increasing more than inflation. Fox Business reports on a new Aon study which says that:

…employer health care expenditures are projected to surge 9% in 2025 to more than $16,000 per employee, markedly higher than the 6.5% increase businesses saw in their health care budgets from 2023 to 2024.

One approach to save money is for employers to directly contract with health care providers. BenefitsPro reports that:

…around 75% of employers have already considered or used direct contracting, and another 41% said they likely will by 2025.

Cost for health care vary between individual and family coverage. KFF reports:

The average annual premium for employer-sponsored health insurance in 2023 is $8,435 for single coverage and $23,968 for family coverage.

For both single and family plans, employees make significant contributions to health insurance.

 On average, covered workers contribute 17% of the premium for single coverage and 29% of the premium for family coverage, similar to the percentages contributed in 2022. Covered workers at small firms contribute, on average, a higher percentage of the premium for family coverage than those at large firms (38% vs. 25%). As a result, the average contribution amount for covered workers at small firms ($8,334) is considerably higher than the average contribution amount for covered workers at large firms ($5,889).

For more information on workers’ health care quality and cost, stay tuned to the Healthcare Economist blog this year.