Connecticut employers have seen their health insurance premium costs rise 135 percent over the past decade, the fourth-highest increase in the nation, according to a new Kaiser Family Foundation report being highlighted by the White House as part of its push for health care reform.

Nationwide, the average per-worker cost for family coverage has jumped from about $5,000 per year in 1999 to about $13,375 this year. In the Northeast, the 2009 premiums are averaging about $700 higher than that.

"The rise in health insurance premiums is burdening families and threatening our economy," the White House said in a statement on the Kaiser report. "Premiums are rising in all states far in excess of wage growth or inflation."

It warned that without health reform, health insurance will become increasingly unaffordable to businesses and families, and many will lose coverage.

To business advocates and employers, the report's findings are hardly surprising. Tony Sheridan, president of the Chamber of Commerce of Eastern Connecticut, said paying for health insurance for employees is "the costliest part of running a small business."

In a survey of its 1,600 member businesses three years ago, he added, an overwhelming number of respondents cited health insurance costs as a major problem.

"Eight-two percent of businesses indicated that the system is broken and needs fixing," Sheridan said.

While there are disagreements about how health insurance and health care should be reformed, he said, there is widespread agreement that something needs to be done, said Eric George, associate counsel at the Connecticut Business and Industry Association. He noted that according to the Kaiser report, the share of premiums being borne by employees and employers has been unchanged at one-quarter to three-quarters, with both sides seeing steady increases.

The report, he said, "just highlights the fact that we've got to do something now."

Controlling health insurance and health care costs, he said, have not received enough attention in the reform debates. Every year, more businesses -- mainly small ones -- drop coverage for employees, and health insurance costs are also preventing employers from adding new employees, he said.

"Businesses are making hiring decisions on health care costs alone," he said.

But the costs of treatments, hospitalization, tests and overuse of the medical care system also need to be addressed in any meaningful reform effort, George said, along with more emphasis on programs that keep people healthy.

That is among the strategies being used at one large local employer, Lawrence & Memorial Hospital, in the hopes that with fewer employee claims for medical care, premium increases can be slowed. The nonprofit hospital spends about $20 million annually to cover about 2,000 employees, said Trish Wettlaufer, benefits program manager. It is anticipating a 10 to 12 percent increase next year, she added.

"It is continually more and more difficult as these increases come across," she said. "We continue evaluating these every year."

During the recession, Wettlaufer said, more L&M employees have been adding spouses to their health insurance coverage, after spouses have lost insurance after layoffs or when employers canceled coverage.