While the amount has more than doubled over the past 10 years, growing from $11,192 to $23,215, the 5.4% growth rate from 2013 to 2014 is the lowest annual change since the Milliman Medical Index (MMI) was first calculated in 2002. Employers pay the largest portion of health care costs, contributing $13,520 per year, or 58% of the total, according to Milliman principals. However, increasing proportions of costs have been shifted to employees.
Since 2007, when the economic recession began, the average employee health care cost to employers has increased 52%—an average of 6% per year—while the expenses borne by the family, through payroll deductions and out-of-pocket costs, have grown at an even faster rate, 73% (average of 8% per year).
The index shows the annual increase in health care cost ranged from a high of 10.1%, in both 2003 and 2004, to a low of 5.4% in 2014. The rate of increase dropped by nearly a full percentage point—from 6.3% in 2013 to 5.4% in 2014. In almost every year of the past 10, growth rates have decelerated.
In each of the past four years, employees have assumed an increasing percentage of the total cost of health care. The total employee cost (payroll deductions plus out-of-pocket expenses) increased by approximately 32% from 2010 to 2014, while employer costs (premium contributions) increased by 26%.
More about the Milliman Medical Index is at http://www.milliman.com/mmi/.