Health Insurance Costs Can Account for More Than 25% of Some Workers’ Incomes, Report Finds
Average employee health insurance premiums for a minimum-wage worker can represent between 25% and 50% of wages, according to a recent analysis released by the California HealthCare Foundation, the Stockton Record reports.
The study, titled, "Health Insurance: Can Californians Afford It?" found that people with chronic illnesses and annual incomes of $29,458 -- the average per capita, net disposable income for California residents -- could pay about 40% of their incomes for limited coverage through a preferred provider organization plan.
In addition, California residents with chronic illnesses who are employed by a small business and are members of a PPO could pay more than $5,000 annually in out-of-pocket costs, according to the report. By comparison, annual out-of-pocket expenses for a healthy person with PPO coverage and employed by a small business could be about $370.
Dr. Mark Smith, president and CEO of CHCF, said that "we should recognize that even for those Californians who are insured, it can be a struggle to pay their share of premiums and out-of-pocket expenses. If health insurance becomes unaffordable, this will increase the numbers of uninsured Californians."
Marian Mulkey, senior program officer for CHCF's Health Insurance Program, said, "Comparing the cost of insurance to the wages and incomes of average workers in California leaves little doubt that premium costs can impact hiring decisions, wage levels and insurance offerings in small businesses" (Goldeen, Stockton Record, 5/5).
The report is available online.