Study: Ohio health insurance costs top U.S. median

Written on Jun 19, 2019

Health insurance premiums and costs are worse in Ohio than in many other states, and worse than the national average, according to a new study.

One in 10 non-elderly Ohioans with employer-sponsored health insurance has high premium contributions relative to their income, according to the report from the Commonwealth Fund.

For 2016-2017, the median annual household spending on these premium contributions in the state was $2,520, putting Ohio in the upper third of states with high costs and above the national median of $2,200.

Annual household spending on out-of-pocket costs for this population is $1,000, which again places the state in the top third and above the national median of $800.

Nationally, an estimated 23.6 million Americans with employer coverage spend a large share of their income on premiums or out-of-pocket costs — or, for 4.1 million Americans, both.

In Ohio, the average annual household spending by non-elderly people with employer-sponsored insurance on premium contributions and out-of-pocket costs combined is $4,200, compared to the national median of $3,700.

Although people who buy plans through the individual market are most likely to be underinsured, those with employer health plans are experiencing the greatest growth in underinsured rates, according to the Commonwealth Fund's research.

"So it's a red flag that suggests that people are being increasingly burdened by higher deductibles and higher cost-sharing," said Sara Collins, a vice president at the Commonwealth Fund.

The main driver of the premium and out-of-pocket growth is the cost of health care itself. In addition, incomes haven't kept pace with the rate of growth in those costs.

To temper the growth, employers share more of their cost with employees in the form of more and higher deductibles.

Collins said she doesn't believe we're seeing a "crisis" in the employer-based system — employers have continued to offer relatively comprehensive coverage — but the trends are pointing in that direction, particularly among folks making middle incomes.

The growing affordability issue in employer-based coverage raises two primary concerns, Collins said. One, people may opt to not take up coverage if it competes with other living necessities. And two, survey data show that people with higher out-of-pocket costs and deductibles are more likely to say they skipped getting needed health care because of those costs.

An "increasing number of people may be making decisions that are against the best interests of their health," she said.

The Commonwealth Fund report lays out a few policy suggestions to potentially begin addressing that. For instance, requiring plans to expand and standardize which services are exempt from the deductible. Congress could raise the percentage of medical costs that employers must cover, on average, and subject employers who don't meet this standard to a penalty and enrollees may be eligible for tax credits to buy marketplace coverage.

To improve the financial protectiveness of employer plans, Congress could also make a refundable tax credit available to people with employer coverage whose out-of-pocket spending for health care exceeds a certain percentage of their income, according to the report.

Growing evidence shows that the primary driver of per capita costs in private insurance is the prices paid to providers, according to the report.

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