In New York, a recent report from KFF’s Employer Health Benefits Survey reveals that the cost of job-based health insurance for both employers and employees has significantly increased this year. According to the survey, the annual cost of family health insurance coverage at the workplace has sky-rocketed to an average of nearly $24,000, marking a 7% increase from the previous year.

Employees are now contributing an average of $6,575 toward their share of the premium, which is up by nearly $500 or approximately 8% compared to last year. The remainder of the premium is being covered by their respective companies.

Matthew Rae, one of the co-authors of the survey, commented on the substantial premium increase, stating, “We have a huge premium increase this year. There’s just no other way to cut it. There are lots of affordability challenges for employer coverage.”

For single coverage, the average annual premium has also seen a 7% increase, rising to $8,435. Workers are now contributing slightly more than $1,400 towards the total premium cost, which reflects an uptick of approximately $75 from the previous year.

The rise in premiums, though significant, is somewhat in line with the growth in wages and inflation since 2022, as well as over the past five years. This is a significant contrast to the early 2000s when premiums were rapidly increasing by double-digit percentages, even though inflation and wage growth remained relatively modest.

The competitive employment landscape has led businesses to maintain their health insurance coverage as a way of attracting and retaining talent, thus avoiding reductions in their offerings.

Deductibles have remained relatively the same this year, likely reflecting employers’ concerns about the financial burden placed on workers when they require medical care. Among workers with deductibles for single coverage, the average annual deductible stands at around $1,735.

While the employers goal is to provide good benefits to retain valuable employees, it’s important for workers to be prepared for increasing premium costs in the coming years. Nearly a quarter of companies indicated that they plan to increase employees’ premium contributions within the next two years.

Notably, employees at smaller organizations tend to bear a higher cost for coverage compared to their counterparts at larger companies with at least 200 employees.

For instance, KDC Mailing & Bindery, a 42-employee firm in Tempe, Arizona, experienced an overall premium increase of about 13% this year. While the company did cover a portion of the expenses, employees had to take on a 3% increase in their premiums, and the company found it necessary to raise prices by as much as 5% to address the additional costs.

Looking ahead, it might be more challenging for the company to continue providing such benefits to its staff, because profit margins might not permit the absorption of these increasing expenses.

In addition to these cost considerations, the survey also touched on the issue of abortion coverage, particularly for large employers operating in multiple states. After the Supreme Court’s 2022 decision, which ended the federal constitutional right to an abortion, many states have adopted laws restricting abortion access.

The survey found that one in ten large firms with at least 200 employees reported that their largest health plan does not cover legal abortions, moreover, an extra 18% indicated that they exclusively provide abortion coverage in particular situations, including instances of incest, rape, or when an individual’s health or life is at risk.

While nearly a third of large firms provide coverage for abortion in most or all circumstances, 40% were unsure of their coverage policy, possibly because of changing or ambiguous regulations.

Following the Supreme Court’s ruling, some companies have pledged to offer financial assistance to employees who need to travel to other states for abortions. Around 7% of larger employers, and a notably larger proportion of companies with at least 5,000 employees (19%), have either started providing or are in the process of planning to offer such reimbursements.