Premiums for employer-sponsored health insurance increased an average of 11.2 percent in 2004, marking the fourth consecutive year of a double-digit increase and outpacing the growth rate in wages and inflation by wide margins, according to a survey released by the Kaiser Family Foundation and Health Research and Educational Trust.

In 2004, inflation increased 2.3 percent and workers' earnings rose 2.2 percent, accoridng to the report.

In 2003, health insurance premiums rose an average of 13.9 percent.

In 2004, premiums reached an average of $9,950 annually for family coverage ($829 per month) and $3,695 ($308 per month) for single coverage, according to the survey.

At least 5 million fewer jobs provided health insurance in 2004 than there in 2001, according to the survey. The researchers say that a smaller percentage of small employers (three to 199 workers) offered health insurance over this period. In 2004, 63 percent of all small firms offer health benefits to their workers, down from 68 percent in 2001.

"Since 2001, the cost of health insurance has risen 59 percent," says Jon Gabel, vice president for Health Systems Studies at the Health Research and Educational Trust. "Over that period, employee contributions increased 57 percent for single coverage and 49 percent for family coverage, while workers wages have increased only 12 percent. This is why fewer small employers are offering coverage, and why fewer workers are taking-up coverage."

The researchers conducted the survey between January and May of 2004, contacting 3,017 randomly selected public and private firms with three or more employees. More than 1,900 firms responded to the full survey.

• View the full report from Kaiser Family Foundation and Health Research and Educational Trust