Rising Health Insurance Premiums Mean Less Take-Home Pay for Employees 

By Consumers for Quality Care, on January 31, 2024

Over the last three decades, employees have had to pay more in health insurance premiums, taking an increasingly large share of employee wages, according to a study conducted by JAMA Network Open and reported by Axios. Although employers typically pay most of their employees’ insurance premiums – roughly 75% of the premium – the amount that workers pay for health insurance has grown faster than their wages. Lower-income workers and workers of color are the most hurt by the rising cost of insurance, but on average, families with employer-based insurance have lost $125,000 in potential earnings over the last 30 years.  

Employer-based health insurance premiums are not charged based on income levels, meaning both high-income and low-income families pay the same rate for the same plan. For low-income consumers, these premiums are progressively taking a larger portion of their salary. From 1988 to 2019, the share of an employee’s salary going toward health care premiums has more than doubled, increasing from 7.9 percent to 17.7 percent. The study found that Black and Hispanic families paid a larger share of their wages towards health insurance premiums compared to white families.  

Coupled with out-of-pocket expenses and high deductibles, paying for medical care has become prohibitively expensive, even for those with health insurance. As a result, many Americans are forced to choose between delaying the medical care they need or accumulating massive amounts of medical debt. Data like this shows that consumers are in desperate need of common-sense health care reforms. CQC urges lawmakers to implement consumer-friendly policies that decrease costs and increase access to health care for everyone.