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Health insurance on your W-2

By Jay MacDonald ·
Tuesday, March 5, 2013
Posted: 10 am ET

This year for the first time, the W-2 "Wage and Tax Statement" you receive from your employer may contain an eye-popping figure: the total amount that you and your employer spent on your health insurance premiums last year.

The Affordable Care Act of 2010, President Barack Obama's historic health care reform legislation, requires all employers with 250 or more workers to include the insurance cost information on your W-2. Next year, companies with fewer than 250 employees will be required to do so.

While the information is not specifically labeled to indicate what it is, you can find it in Box 12. Look for a dollar figure that follows the two-letter code DD. The figure serves as a close approximation of what health insurance would cost you without your employer subsidy -- for example, if you chose to continue coverage under COBRA.

To isolate your employer's share, you simply take the amount from Box 12 and subtract what you paid for health insurance, which should appear on your final pay stub of the year.

A 2012 Kaiser Family Foundation survey found that employer-sponsored health insurance cost the average individual $5,615 and the average family $15,745.

The move toward more transparency is designed to help prepare working Americans to make informed decisions about the changing health care options they may face as Obamacare continues to reshape the health insurance landscape.

A new report by the research firm Aon Hewitt finds that two-thirds of the nearly 800 large and midsize U.S. employers who were surveyed planned to move away from traditional managed plans in the next three to five years and toward options that require employees to take a more active role in their health care coverage. Among the companies surveyed.

  • Almost 40 percent expect to migrate toward a "house money/house rules" approach in which they can reward employees who exhibit good health behaviors or who can show measurable progress toward their health goals.
  • About 28 percent plan to move to a private health care exchange similar to the state health exchanges for individuals and small businesses that are scheduled to open in 2014.
  • Just 6 percent of employers said they plan to drop employee health insurance completely in the next three to five years.

With so many new health insurance options on the horizon for working Americans, knowing the price tag for the coverage you have now could come in handy in the near future.

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