Several employers made pandemic-related changes to their workers' health benefits, including increasing telemedicine access and mental health services—and they did so without major changes to annual premiums and deductibles for employer-sponsored health coverage in 2021, according to the Kaiser Family Foundation's (KFFs) annual Employer Health Benefits Survey.
Survey details & key findings
For the survey, KFF partnered with NORC at the University of Chicago and Davis Research. Davis Research surveyed human resource and benefits managers at 1,686 U.S. employers about employer-sponsored health coverage for individuals and families between January and July 2021.
Overall, the survey found that average premiums increased 4% in 2021, to $7,739 for single coverage and $22,221 for family coverage. On average, employees with individual plans contributed 17%, or $1,299, toward their premiums, while employees with family plans contributed 28%, or $5,969, toward their premiums.
According to KFF, the annual change in premiums has roughly matched the year-to-year rise in employee wages (5%) and inflation (1.9%), but the cost of premiums over time has risen more quickly. Since 2011, average family premiums have increased by 47%, higher than both wages (31%) and inflation (19%).
The survey found that the average annual deductible in 2021 was $1,669, largely similar to the average deductibles of the past two years ($1,644 in 2020 and $1,655 in 2019). However, KFF noted that the average deductible has increased significantly (68%) over the past decade.
In addition to changes in cost, the survey also found that many employers made changes to the benefits they offered their workers, including telemedicine, mental health, and wellness programs.
For instance, in 2021, 95% of employers with at least 50 workers offered at least some access to telemedicine, up from 85% in 2020 and 67% three years ago. Of these employers, nearly two-thirds said they made changes to their telemedicine coverage because of the pandemic. Some of these changes include increasing the number and types of providers available, adding additional communication modes, and reducing or eliminating cost-sharing for telemedicine.
Many employers also reported making changes to their mental health and substance use benefits. The survey found that 39% percent of employers with at least 50 workers said they made such changes, including:
- 31% increasing access to mental health services, including through telemedicine;
- 16% offering employee assistance programs or other resources for mental health;
- 6% expanding access to in-network mental health providers;
- 4% reducing cost-sharing for mental health services; and
- 3% increasing coverage for out-of-network services.
Employers also reported that more workers are using mental health services since the Covid-19 pandemic began, KFF writes. Twelve percent of employers with at least 50 workers, including 38% of companies with at least 1,000 workers, said they saw an increase in employees' use of mental health services.
Finally, more than half of employers with at least 50 workers said they made changes to their wellness programs because of the pandemic. Some common changes include expanding counseling services, adjusting programs to better meet the needs of people working from home, and adding a new digital program, such as an app.
According to Gary Claxton, an SVP and director of the Health Care Marketplace Project at KFF, "there were only modest changes in the cost of employer-provided health benefits" in 2021.
"With the pandemic, I'm not sure that employers wanted to make big changes in their plans, because so many other things were disrupted," he said. "It's hard to even communicate changes right now."
Instead, Claxton said that "[s]ome employers adapted their plans to address mental health and other challenges facing their workers due to Covid-19" by expanding or adjusting their existing health benefits.
"The expansions of telemedicine and mental health benefits were important in meeting the needs of employees and their families in difficult times," wrote KFF analysts, including Claxton, in Health Affairs. "These types of changes made sense not because employers want to spend more, but because employers want their employees to see their health benefit programs as 'benefits' and to value them as such." (Kaiser Family Foundation 2021 Employer Health Benefits Survey, 11/10; Kaiser Family Foundation news release, 11/10; Herman, Axios, 11/10; Mathews, Wall Street Journal, 11/10; Andrews, Kaiser Health News, 11/10; Hellmann, Modern Healthcare, 11/10)