The latest national survey of health insurance trends is drearily familiar. Employers faced another year of double-digit rate increases -- 12.7 percent this year, the largest since 1990. And there's also less coverage for retirees and for small-business workers.

"It's hard to find a lot of good news in this study, except to say: I suppose it could have been worse," said Drew Altman, chief executive of the Kaiser Family Foundation, which sponsored the study with the Health Research and Educational Trust. The survey of 3,262 public and private employers, released Thursday, found that premiums are likely to continue to rise.

"We should expect to see sharply rising health care costs for the foreseeable future," Altman said. "Workers can expect to pay more and get less coverage."

The increases are attributed largely to more spending on prescription drugs and hospital care by an aging population. For the first time in four years more workers experienced reduced benefits than increased benefits, the report said.

Altman said he was struck by the drop in coverage for retirees. Over the past two years, 9 percent of large employers -- those with 200 or more workers -- have eliminated retiree benefits for new hires or existing employees, the survey said.

What's more, 11 percent of large employers say they will likely eliminate retiree benefits for new employees or existing workers over the next two years.

"There will be less and less retiree coverage," Altman predicted. "If I were a baby boomer I would be quite worried about that."

In addition, the number of small employers (three to 199 workers) offering health coverage dropped from 67 percent in 2000 to 61 percent this year. Small employers are particularly vulnerable to premium increases because they have less bargaining power with insurers, Altman said.

With the downturn in the economy, Altman called the premium increases a "double whammy" for employers, large and small. Employers have responded by cutting benefits or raising the cost to employees.

The cost of premiums reached new plateaus this year: about $3,000, on average, for single coverage and $8,000 for family coverage, the survey said.

While employers still pick up most of the costs, the employees' share has risen substantially. Employees now pay an average of $454 per year for single coverage (a 27 percent increase over last year) and $2,084 per year for family coverage (a 16 percent increase).

Employees also are paying higher deductibles and co-pays for prescription drugs this year, the survey reported.

And there's more pain on the way, Altman said. Among large employers, nearly eight of 10 reported they will likely increase the amount employees will pay for premiums next year.

The survey's findings on declining retiree benefits will be validated by another study this fall -- this one by employer benefits consultant Watson Wyatt Worldwide, according to Sylvester Schieber, the firm's research director.