Even with a historically low annual rate of increase, American families are spending $19,393 on healthcare in 2011, according to the Milliman Medical Index.
The index, presented by the Seattle-based global consulting and actuarial firm, measures the total cost of healthcare for a typical family of four covered by a preferred provider organization.
The 2011 MMI cost of $19,393 is an increase of 7.3 percent over 2010, which is the lowest annual rate of increase in more than a decade. However, though the rate of increase is the lowest in recent memory, the increase in total dollars – $1,319 in 2011 – is the highest in the history of the study.
[See also: Family healthcare costs rise significantly in 2010.]
"In 2002, American families had healthcare costs of $9,235, and those costs have now doubled in fewer than nine years," said Lorraine Mayne, a Milliman principal and consulting actuary. "As costs continue to grow – and even as the cost trend decelerates – the total cost of care for American families constitutes a larger and larger portion of the household budget."
Of that $1,319 increase, employers bore $641 while employees shouldered the rest – $403 in payroll contributions and $275 in additional cost sharing.
"As has been the case in four of the last five years, employees are paying a larger share of the cost increase than their employers," said Scott Weltz, a consulting actuary at Milliman. "That said, in absolute dollars, both employers and employees have shouldered approximately the same amount of additional costs since 2006, with employers absorbing $3,023 and employees absorbing $2,988."
In addition to looking at costs on a nationwide basis, the Milliman Medical Index also examines 14 geographic areas.
"This year, six of the 14 cities we studied exceeded $20,000 in total costs for a typical family of four," said Milliman principal and consulting actuary Chris Girod. "But we still have several cities – Phoenix, Atlanta and Seattle – with less than $19,000 in total costs for the typical family. These cost differences result from variation in local practice patterns and from differing costs for healthcare goods and services."
The index report also notes that employers are putting more consideration into the design of benefit plans and are more focused on cost efficiency.