Rising Health Costs Reduce Amount of Workers’ Pay Raises

Health insurance premiums, which are increasing "at their fastest clip in a decade," will "eat up" workers' pay raises next year, USA Today reports. Driven by higher demand for hospital services and prescription drugs, health insurance premiums are expected to increase an average of 15.4% for employers next year. Some employers are shifting those increases to their employees, asking workers to pay 10% to 30% more toward monthly premiums, increasing deductibles and establishing increased copayments for office visits, hospital care and medications. According to Hewitt Associates, workers' health costs will increase by an average of $342 to $1,753 next year. For a worker who earns $597 per week -- the national median -- and receives a 4% raise, rising health care costs would constitute 28% of the pay increase, USA Today reports (Appleby, USA Today, 11/4).