The retiree share of retiree health coverage premiums for new retirees has risen rapidly in the recent past. Early (pre-age 65) retirees experienced a 27% increase from 2003 to 2004, while Medicare-age retirees experienced a 24% increase. Contribution levels for retirees in the same firm often vary based on such factors as when they retired, years of service with the employers, and job classification.

Notes: Based on responses from private-sector firms with 1,000 or more employees that offer retiree health benefits.  Average increase was weighted by the number of retirees in the employer's largest plan and by the employer size.  Premiums for retiree-only coverage for full-time employees retiring in 2002, 2003, and 2004, in plans with the largest number of enrolled retirees.

Source: Kaiser Family Foundation/Hewitt Associates, Current Trends and Future Outlook for Retiree Health Benefits: Findings from the Kaiser/Hewitt 2004 Survey on Retiree Health Benefits, December 2004, Exhibit 10, at http://www.kff.org/medicare/7194/retiree_ben_sec3.cfm.