According to a new survey, the cost of employee health insurance rose 7.7 percent this year - while wages rose only 3.8 percent. Believe it or not, this is almost good news to some. The rate of increase is actually declining. The cost of health care rose 9.2 percent in 2005 and 11.2 percent in 2004. Nevertheless, "while premiums didn't rise as fast as they have in recent years, working people don't feel like they're getting any relief at all, because their premiums have been rising so much faster than their paychecks," says Drew Altman of the Kaiser Family Foundation, which conducted the survey. He adds, "The cost trend is moderating but nobody is celebrating."

Employees of smaller companies, which typically offer preferred provider (or PPO) plans, pay an average of $3,497 in premiums out of a total of $11,793, while those who work for larger companies pay slightly less - an average of $2,628 out of $11,752. The employers kick in the rest. The average premium for an individual is about 16 percent, while it is 27 percent for families. The bottom line is that the ones who suffer most from the increases are those good American folks with mouths to feed, kids to raise, and college costs looming on the horizon - which are also now sky high. That is if those folks are insured through their employer. Those who need to pay for their own health care insurance take the full brunt of the increases. With fewer corporations able to pay for expensive employee health benefits, more and more of us will be joining that overburdened group in the future.

Rich Morrison, a VP at a Florida hospital, is not sanguine about the years to come. The survey "doesn't bode well long term for the affordability of health insurance...This is one of the few times I can't see the light at the end of the tunnel." He continues, "This can't go on. Every year we're compounding the problem, and the spread (between health care costs and wages) will grow."

Becky Cherney, head of the Florida Health Coalition, agrees, emphasizing that even a 7.7 percent increase "is not sustainable. Health care simply can't keep taking a bigger and bigger bite out of people's incomes."

"Health Care Costs Rise Twice as Much as Inflation" from The New York Times (Registration may be required)
"Health premiums climb 7.7%" from the Orlando Sentinel
"Salaries lag behind health care costs" from the Register-Guard (Eugene, Oregon)