Geaux4it
Intensity Factor 4-Fold
- May 31, 2009
- 22,873
- 4,295
http://www.kaiserhealthnews.org/Sto...th-insurance-premium-increases-obamacare.aspx
When setting premiums for next year, insurers baked in bigger-than-usual adjustments, driven in large part by a game-changing rule: They can no longer reject people with medical problems.
Popular in consumer polls, the provision in the health law transforms the market for the estimated 14 million Americans who buy their own policies because they don’t get coverage through their jobs. Barred from denying coverage, insurers also can’t demand higher rates from unhealthy people and those deemed high risks because of conditions including obesity, high blood pressure or a previous cancer diagnosis.
But the provision also adds costs. To a larger degree than other requirements of the law, it is fueling the “sticker shock” now being voiced by some consumers about premiums for new policies, say industry experts.
In setting next year’s rates, insurers must factor in “assumptions about who will sign up, high users or healthy people,” said David Axene, a fellow of the Society of Actuaries. “You can imagine who most of the health plans thought would be predominantly signing up.”
“I’m kind of shocked,” said Leo Lenaghan, who lives in the Chicago suburbs. The $336-a-month BlueCross Blue Shield policy for his wife and daughter, which had a $2,250 per person annual deductible, is being discontinued and the plan his insurer says is most similar to it in benefits will cost an additional $205 a month. It has a $3,000 per person deductible. “I guess we’re just going to have to suck it up.”
The less their policies covered previously, the more consumers’ premiums are likely to rise, experts say. While adding some benefits only costs “pennies on the dollar,” said Georgetown University research professor Sabrina Corlette, others are more expensive. A Maryland Health Care Commission report from last year, for example, said the state’s requirement that insurers include maternity coverage added about 4 percent to the cost of a premium.
The actuarial firm Milliman estimated that changes from the health law – including the take-all-applicants provision - could be expected to result in about a 14 percent increase to the average premium in California. On top of that, general medical inflation from 2013 to 2014 would add another 9 percent. Of all the factors, the biggest cited by Milliman was the guaranteed coverage provision.
When setting premiums for next year, insurers baked in bigger-than-usual adjustments, driven in large part by a game-changing rule: They can no longer reject people with medical problems.
Popular in consumer polls, the provision in the health law transforms the market for the estimated 14 million Americans who buy their own policies because they don’t get coverage through their jobs. Barred from denying coverage, insurers also can’t demand higher rates from unhealthy people and those deemed high risks because of conditions including obesity, high blood pressure or a previous cancer diagnosis.
But the provision also adds costs. To a larger degree than other requirements of the law, it is fueling the “sticker shock” now being voiced by some consumers about premiums for new policies, say industry experts.
In setting next year’s rates, insurers must factor in “assumptions about who will sign up, high users or healthy people,” said David Axene, a fellow of the Society of Actuaries. “You can imagine who most of the health plans thought would be predominantly signing up.”
“I’m kind of shocked,” said Leo Lenaghan, who lives in the Chicago suburbs. The $336-a-month BlueCross Blue Shield policy for his wife and daughter, which had a $2,250 per person annual deductible, is being discontinued and the plan his insurer says is most similar to it in benefits will cost an additional $205 a month. It has a $3,000 per person deductible. “I guess we’re just going to have to suck it up.”
The less their policies covered previously, the more consumers’ premiums are likely to rise, experts say. While adding some benefits only costs “pennies on the dollar,” said Georgetown University research professor Sabrina Corlette, others are more expensive. A Maryland Health Care Commission report from last year, for example, said the state’s requirement that insurers include maternity coverage added about 4 percent to the cost of a premium.
The actuarial firm Milliman estimated that changes from the health law – including the take-all-applicants provision - could be expected to result in about a 14 percent increase to the average premium in California. On top of that, general medical inflation from 2013 to 2014 would add another 9 percent. Of all the factors, the biggest cited by Milliman was the guaranteed coverage provision.
