People Who Purchase Insurance On Their Own Faced Premium Hikes Of Around 20 Percent, Survey Finds

The New York Times: People who purchase health insurance on their own were faced with premium increases averaging 20 percent when they last sought to renew their coverage, according to a survey (.pdf) released Monday by the Kaiser Family Foundation. (KHN is a project of the Kaiser Family Foundation.) "While some people switched to less expensive plans that offered less generous coverage, and others negotiated lower prices than their insurers initially requested, the people surveyed still reported an average increase of 13 percent on their health insurance costs. ...

"Health insurers say any rate increases reflect the rapid growth in the underlying cost of medical care. 'The data show premiums track the underlying cost of health care,' said Robert Zirkelbach, a spokesman for America's Health Insurance Plans, an industry trade association in Washington" (Abelson, 6/21).

The Associated Press: "That hike tops last year's average 5 percent annual increase for employer-sponsored family coverage and almost unchanged premiums for employer-sponsored single coverage, though foundation Vice President Gary Claxton said the comparisons come with qualifications. The individual insurance survey asked respondents for their most recent premium increases, which can happen more or less frequently than the annual increases mostly seen in the group market, he said." According to KFF, an estimated 14 million Americans younger than age 65 obtain their health insurance through the non-group or individual market while about 157 million get coverage through an employer (Murphy, 6/21).

Bloomberg Businessweek: "Policyholders who purchased their own coverage spent an average $1,690 on health expenses in the past year in addition to their annual premium and typically had higher deductibles, according to the report. The average annual deductible for individuals who buy their own policies is $2,498 compared with $634 for the most common type of employer-sponsored health insurance." The survey, which was conducted in March and April, polled 1,038 buyers of their own individual or family health plan (Collins, 6/21).

Reuters: "The findings come as the Obama administration works with insurers to implement some of the new rules under the recently passed healthcare law, which aims to expand consumers' coverage while cracking down on discriminatory industry practices. … Although individual, or 'nongroup,' policies are a small slice of the health insurance industry, they have attracted sharp scrutiny in recent months amid reports of price increases as high as 39 percent" (Heavey, 6/21).

The Sacramento Bee: "The researchers acknowledged that they did not look into cost drivers, and could not say whether the increases were 'legitimate or not.' But they said it was understandable for consumers to view the increases as unreasonable. … Spokespersons for the insurance industry have blamed the rate hikes on the rising costs for hospital care, doctors' bills and prescriptions" (Caina Calvan, 6/21).

Kaiser Health News: "Tracking premium increases among individual purchasers is difficult: States vary widely in how they collect and report increases, insurers offer many types of policies and premium increases are based on many variables, many of them policyholder-specific, such as age. Actuaries also expect higher medical claims the longer a person holds a policy, and premium increases sometimes reflect that. Other surveys, including data from the lobbying group America's Health Insurance Plans and insurance sales website Ehealthinsurance, show the average cost of premiums, but don't ask about increases" (Appleby and Schiff, 6/21).

Wall Street Journal: "While legislation may end up helping these people with new exchanges and provisions that disallow insurers from using health status to price policies, many key provisions don't kick in until 2014, the study authors write" (Hobson, 6/21).

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