Summary:
Over the past two decades, out-of-pocket healthcare costs, including deductibles, copayments, and coinsurance, have risen significantly for individuals with employer-sponsored insurance. Since 2003, these costs have increased by 37%, outpacing wage growth and inflation for much of the period. In 2023, 66% of employer-covered individuals spent over $100 on out-of-pocket expenses. This trend highlights the growing financial burden on employees and underscores the need for greater awareness of healthcare cost-sharing dynamics.
What This Means for You:
- Evaluate your employer-sponsored health plan’s cost-sharing structure to better anticipate annual healthcare expenses.
- Consider contributing to a Health Savings Account (HSA) or Flexible Spending Account (FSA) to offset out-of-pocket costs.
- Review and compare healthcare plans during open enrollment to identify options with lower deductibles or copayments.
- Prepare for potential future cost increases by budgeting for healthcare expenses as part of your financial planning.
Original Post:
Over the past decade, cost-sharing (the out-of-pocket portion of household health spending) has grown faster than both workers’ wages and general inflation for those with employer coverage. In recent years, that growth has reached a rate more similar to inflation. Since 2003, average out-of-pocket costs have increased by 37%. In 2023, a majority (66%) of people with employer coverage spent more than $100 on out-of-pocket costs.
This chart collection examines trends in employee spending on deductibles, copayments, and coinsurance from 2012 to 2023, using a sample of health benefit claims for individuals under 65 from the Merative™ MarketScan® Commercial Database.
The full analysis and other data on health costs are available on the Peterson-KFF Health System Tracker, an online information hub dedicated to monitoring and assessing the performance of the U.S. health system.
Extra Information:
Explore these resources for deeper insights: Healthcare.gov’s Cost-Sharing Glossary explains key terms, and the KFF Health Costs Hub provides extensive data and analysis on healthcare affordability and spending trends.
People Also Ask About:
- What is cost-sharing in health insurance? Cost-sharing refers to the portion of healthcare expenses paid by the insured, including deductibles, copayments, and coinsurance.
- How can I reduce my out-of-pocket healthcare costs? Consider enrolling in plans with lower deductibles or utilizing tax-advantaged accounts like HSAs or FSAs.
- Why are out-of-pocket costs increasing? Rising healthcare costs, increased utilization, and higher deductibles are key factors.
- What is the difference between a deductible and coinsurance? A deductible is the amount you pay before insurance kicks in, while coinsurance is the percentage you pay after meeting the deductible.
Expert Opinion:
Healthcare economist Dr. Sarah Collins notes, “The steady rise in cost-sharing underscores the need for systemic reforms to ensure that employer-sponsored insurance remains affordable for workers. Policymakers and employers must collaborate to address this growing financial burden.”
Key Terms:
- cost-sharing in health insurance
- out-of-pocket healthcare costs
- employer-sponsored health plans
- Health Savings Account (HSA) benefits
- rising healthcare deductibles
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