Insurance Rates Spike in California, Study Shows

March 18, 2004

Californians paid more for health insurance from their employers in 2003 than workers in any other state, according to a study released March 16.

Insurance premiums rose 15.8 percent last year, the biggest increase in four years, a joint study by the Kaiser Family Foundation and Health Research & Educational Trust showed. The national average was 13.9 percent.

The study said employers passed rising costs onto workers.

“We need policies at the state and federal level that confront the rising health care costs by drug companies, HMOs and providers, rather than false solutions that simply shift more of the cost onto consumers,” said Anthony Wright, executive director of Health Access, a consumer advocacy group in Sacramento.

Though the state had the nation’s biggest percentage increase, Californians pay less for health insurance. The average annual premium for family health coverage was $8,504 in the state, compared with $9,068 nationwide, the study showed.

The average premium for individual coverage was $3,102 in California and $3,383 nationwide.

Gary Claxton, an author of the study, said one major reason Californians pay less is the state’s many HMO organizations, which generally offer cheaper rates.

The study found that in 2003, 52 percent of Californians were enrolled in HMOs, compared to the 24 percent national average.

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Topics California

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