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HEALTH Market - Insurance Premiums
Hawai`i v.s. U.S. Health Insurance Premiums: Survey data collected by the federal government enable comparisons of private employer-sponsored health insurance premiums in Hawai'i with those for the country as a whole. In 1996, the earliest year for which these data are available, Hawai'i and national premiums were very similar for single enrollees and for family coverage. Since that time, premiums have increased more nationally than in Hawai'i. As of 2006, the latest available information, Hawai'i premiums for single coverage averaged 14 percent below the nation as a whole, and family coverage averaged nearly 17 percent below the nation.

Growth in Insurance Premium: National growth rates are outpacing the growth of inflation and labor productivity by a substantial amount. Health insurance premiums increase because the underlying health care costs are increasing. Forty to seventy percent of the growth in health insurance premiums nationally and in Hawai'i comes from costly but beneficial new technology. Almost all the rest of the growth comes from higher wages and profits, and increased incidence of some diseases.1

Premiums Paid by Employees: Analysis of the percent of total premiums paid by the employee reveals even greater differences between Hawai'i and the rest of the country. Some of these differences reflect the impact of the Prepaid Health Care Act (PHCA), which restricts the premium amount the employer can pass on to the employee. Hawai'i employers may cover the full cost of the health insurance premium, or share the cost with their employees. Based on a fixed formula, the law requires employers to contribute 50 percent of the premium cost for single coverage, and the employee must contribute the balance, provided the employee's share does not exceed 1.5 percent of his or her wages. For single coverage, Hawai'i employees paid about 10 percent of the total premium in 2006, compared with nearly 19 percent for the country as a whole. The PHCA applies to employee coverage only, not dependent coverage. For family coverage, Hawai'i's employees are paying about 26 percent of the total premium, roughly equivalent to the national average of 25 percent.


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Summary
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Compare Health Data
> Single Coverage Premium, Hawai`i vs. U.S.
> Family Coverage Premium, Hawai`i vs. U.S.
> Employee Share of Total Single Coverage Premium, Hawai`i vs. U.S.
> Employee Share of Total Family Coverage Premium, Hawai`i vs. U.S.
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Source: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey, Insurance Component.; University of Hawai`i at Manoa Projections.
Note: Values for 2004-2006 are projected via a non-linear, discrete-time formula.
Source: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey, Insurance Component.; University of Hawai`i at Manoa Projections.
Note: Values for 2004-2006 are projected via a non-linear, discrete-time formula.
Source: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey, Insurance Component.; University of Hawai`i Social Science Research Institute weighted tabulations.
Source: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey, Insurance Component.; University of Hawai`i Social Science Research Institute weighted tabulations.