Pennsylvanians pay less for their coverage than U.S. average
By: Health Insurance
Submitted: 2009-10-05 19:18:54 | Word Count: 740
Pennsylvania workers paid a bit less than the national average toward their health insurance coverage last year, but their employers paid above-average premiums, according to data computed by the U.S. Agency for Healthcare Research and Quality.
Pittsburghers, meanwhile, generally paid less than Philadelphians for insurance coverage, according to the same data.
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In Pennsylvania last year:
• Employees contributed an average of $852 toward their individual health policy. The national average is $882.
• For a family health policy, employees here contributed an average of $2,971. The national average last year for family coverage was a $3,394 contribution.
• Private-sector businesses faced an average of $4,499 in total premiums per individual employee, above the national average of $4,386 per year. The total premium tallies both the company's contribution and the employee's.
• Large employers seem to enjoy a group discount. Pennsylvania businesses with more than 100 employees faced an average total premium of $4,711 per individual worker; companies with more than 1,000 employees had an average total of $4,435. The average total individual premium at businesses with fewer than 10 employees was $5,039 per worker. Those figures exceed the national averages, too.
• The average total premium for a family plan in Pennsylvania was $12,339, above the national average of $12,298.
All of the figures have built-in error margins, but taken together the data suggests that while health insurance costs more in Pennsylvania than in other states, the workers here themselves pay a little less.
The agency culls numbers from various surveys and panels. The state and national numbers generally have a smaller standard error margin -- that is, they are more reliable -- than the local numbers because the local estimates rely on smaller surveys and sample sizes.
The Agency for Healthcare Research and Quality's data suggested the average total premium -- employer contribution, plus the business's share -- was $4,304 in Pittsburgh last year. That's compares with $4,739 in the Philadelphia region, which seems in line with numbers collected over the years. Philadelphians pay more for most types of insurance than people in the western half of the state.
But the agency generally doesn't rank metropolitan statistical areas, because doing so "implies a difference between the estimates that is not supported by the data. The samples underlying the MSA-level estimates are much smaller than those at the state or national level," wrote Jim Branscome, an agency statistician.
The numbers could come into play as the state investigates Pennsylvania's insurance marketplace, to see if the Blues are playing by the rules.
This summer, the state's Department of Insurance launched an investigation of Pittsburgh's Highmark Inc. and the rest of Pennsylvania's Blue Cross-Blue Shield insurers, to determine if they are "engaged in anti-competitive or unfair trade practices in violation of the law" and, implicitly, whether those practices might inflate the cost of insurance in the state.
At the time, a Highmark spokesman said that, "We continue to believe that substantial competition exists in Pennsylvania's regional health insurance markets."
John Horty, Pittsburgh attorney and an expert in health and hospital law, said last week that even if the state department judges the cost of health care in Pennsylvania to be out of whack, it will be tough to say whether that's the result of a few dominant health insurers, or the dominance of the hospital systems, or something else.
"I would say that it's going to be difficult to prove fault," he said. "It's probably, partially, everybody."
That insurance department investigation came three months after West Penn Allegheny Health System filed a federal suit against Highmark and the University of Pittsburgh Medical Center, accusing both systems of antitrust violations and collusion in an effort "to destroy West Penn Allegheny."
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