Chris Fleming hosted the Inauguration Edition of the Health Wonk Review this week at Health Affairs Blog, and it’s an excellent compilation of articles. The article written by one of our favorite bloggers, Maggie Mahar, about health insurance premiums in 2014 and beyond caught my attention, because that’s an issue we’ve been watching closely for some time. It’s a question that’s on a lot of minds right now – especially for people who buy their own health insurance and are in the segment of the population that is most likely to experience changes (in coverage, premium, how policies are purchased, etc.) in 2014. Jay and I not only work in the individual health insurance industry, but we’re also policyholders – we’ve have individual health insurance since 2003. We’ve had two carriers and several plan designs over the last decade, and we’ve experienced double digit percentage rate increases nearly every year (somewhat offset by the fact that we’ve been willing to increase our deductible and out-of-pocket limits several times).
We currently pay just over $400/month (for our family of four) for an Anthem Blue Cross Blue Shield CoreShare plan with a $3500 deductible and another $3500 in coinsurance. We know that our rate will go up in the fall – it always does – but how much? How much will prices go up for all of our clients who are covered by all of the biggest health insurance carriers in Colorado?
I don’t know the answer to that question. And I don’t think that anyone really does. The post Maggie wrote references an article from Bob Laszewski that predicts rate increases of 25 – 50%, with some rates actually doubling, while Maggie’s prediction is more along the lines of a price decrease for people who qualify for subsidies, with an average price increase of just over 10% for those who don’t (anyone making more than 400% of FPL). The answers seem to change based on who’s doing the math, and it would be disingenuous to say that all of the numbers are objective. In general, I’ve found that the people who support the ACA are more likely to predict small rate increases and smooth sailing next year, while those who oppose the law are likely to predict large rate increases and general doom and gloom.
Here’s what I do know.
The MLR (medical loss ratio) has already been in effect for two years. Carriers have had to limit their overhead to 15 – 20% of premiums since […]