For New Jersey small firms, health costs soar

New Jersey's smallest employers are increasingly dropping health coverage, according to a survey released this morning by the New Jersey Business & Industry Association.

Four years ago, 92 percent of companies employing two to 19 workers provided health insurance. In 2007, only 75 percent provided the benefit.

Most said they could no longer afford the cost. For example, premiums were up 9.8 percent over the last year to $7,251 per employee at firms with two to 50 employees, not including the portion of the premium they may have asked employees to cover.

One in 10 companies in the survey no longer had enough employees participating to qualify for a group plan.

On average, overall employer health insurance costs rose 9.4 percent to $7,139 per employee in 2007, not including the employee's cost of the premium.

Insurance premiums for larger companies - those with more than 51 employees - rose less, 7.7 percent to $6,598 per employee.

Though costs are up, the rate of increase declined in 2007.

The association conducted its survey in January and said the respondents, the first 1,047 that answered the survey, represented all industry sectors and all New Jersey counties.