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Study: Premium growth slowed after Obamacare

Andriy Solovyov

The Affordable Care Act may be helping to slow down the ever-growing costs of health care, according to a new report. Still, the health care law has yet to entirely live up to its name.

Employer-sponsored health insurance premiums grew more slowly in 31 states and the District of Columbia between 2010 and 2013 -- after the passage of Obamacare -- compared with 2003 to 2010, according to the nonpartisan foundation the Commonwealth Fund.

The slowdown in the growth in premiums is tied to the recent historic slowdown in health care costs, Commonwealth Fund President David Blumenthal told reporters Wednesday, and could be attributed to a variety of factors. Those include the continuing effects of the recession and new Obamacare policies.

However, wages have grown even more slowly since 2003, meaning workers and their families have yet to see the benefits of the changes in the health care market. Health insurance costs -- including employee premium costs and deductibles -- grew faster than income in every state, the report found.

"This means that out of pocket costs ... are consuming a greater share of income," Cathy Schoen, executive director of the Commonwealth Fund Council of Economic Advisors, explained to reporters Wednesday. "Rising out of pocket costs mean less affordable care."

By 2013, average annual premiums, including both employer and employee contributions, represented 20 percent or more of household income in 37 states. That's compared to just two states in 2003.

Workers in Southern states face the highest cost burdens, since median incomes are lower there. In 12 Southern states, average total premiums amounted to at least 22 percent of median income.

While some living expenses in the South -- such as housing costs -- may correspond with incomes, Schoen noted that there's little variation in health care costs nationwide.

"Health insurance is expensive, no matter where you live," she said.

In addition to paying more in premiums, the report found that workers are also paying more for deductibles. From 2003 to 2013, deductibles doubled or more in all but six states and the District of Columbia. "High deductibles are now the rule rather than the exception," Schoen said.