Posts Tagged ‘health insurance premiums’

Health Insurance Premiums Have Been Increasing for Years

Saturday, June 7th, 2014

A recent study done by the Commonwealth Fund found that health insurance premiums have been increasing for years.  The nonprofit group performed this study to determine what had been happening in the health insurance industry before the implementation of the Affordable Care Act changes.  They wanted to show the public the whole picture so that people aren’t blaming all of the health insurance increases on Obamacare.  This information comes from Maggie Fox’s NBC News article, “Health Insurance Premiums Have Been Increasing Since 2008.”  They studied health insurance premiums in the private health insurance markets.  Those are the individual and family health insurance plans that Americans find and pay for out of their own pocket, not through a group or employer.  The study found that health insurance premiums have been steadily increasing since 2008.

Individual insurance premiums increased by at least 10% per year from 2008-2010.  We are still waiting to see what the premium prices will be for 2015, but most experts agree that they will be higher than this year’s prices.  The study results point out that premium increases really cannot solely be attributed to mandatory changes brought about by the Affordable Care Act because premium prices were rising 10% per year before the law took effect.  Premiums almost have to increase because health insurance companies have to cover much more than they covered before the ACA took effect.  Insurers can no longer deny coverage to people with preexisting conditions either, so it costs them much more money to offer insurance plans.  They can’t exclude maternity coverage from plans or charge cancer patients more for their insurance policies, so premium prices across the board are likely to increase.

State and federal run health insurance exchanges started offering plans this year.  Before these exchange plans were an option, an estimated 14 million people bought individual health insurance plans outside of the workplace.  This is either because they don’t have a job or their employer doesn’t offer them health insurance coverage.  Eight million people have bought insurance plans through the exchanges this year, according to the President’s administration.  A Gallup poll found that the number of Americans without health insurance went from 18% in December to 13.4% in May.  It’s going to take years before we know the true effect of the Affordable Care Act on the health insurance industry, especially because of the plans that have been allowed to continue offering sub-standard policies for two more years.  It will just be important to keep in mind that health insurance plans were rising before the ACA as well.  Increases in 2008, 2009 and 2010 were 9.9%, 10.8% and 11.7%, respectively.

Latinos React Differently to Health Insurance Marketing

Saturday, March 8th, 2014

While we are the United States of America, we are made up of a wealth of different cultures and backgrounds.  Some health insurance marketing fails to take that fact into account.  In “Selling Health Care To California’s Latinos Got Lost In Translation,” NPR Station WCAI discusses the nuances with the Latino culture and health care.  The article specifically looks at California because 30% of the state speaks Spanish.  Unfortunately for many advertisers and health insurance companies, simply translating an English slogan or commercial to Spanish does not work.  Covered California, the state insurance exchange, started advertising benefits of the new health insurance laws that don’t actually appeal to many Hispanics.  Advertising the importance of not being denied coverage for pre-existing conditions is great for most Americans.  Many people have been denied individual health insurance or know someone who has.  But this article says that the majority of Hispanics in California not only have never even been insured, they also haven’t even shopped around for health insurance because they didn’t consider it.  Having health insurance isn’t typically a norm in their culture.

Another problem with the Covered California Spanish advertising is that the commercials end by listing a website to visit, but no phone number or address.  Latinos are all over the internet, but research has shown that they don’t prefer to do transactions online.  They would rather speak to someone on the phone or in person.  This especially holds true for purchasing health insurance because it can be complex, confusing, and many of them have never had health insurance before.  Officials say that they have been working on offering more locations for Latinos, as well as other residents, to be able to physically go somewhere and speak with someone about their health insurance options.

The Covered California name itself doesn’t really translate to something exciting and the ads have been perceived as “dry”, exactly the opposite of the Latino culture.  It’s seems simple as an outsider to see that you need to market your insurance plans differently to different cultures.  And in California, when 30% of the population is Spanish speaking, you have to account for that and the differences in the Latino culture.  It matters to the general population if Latinos sign up for health insurance coverage.  Why?  Latinos are younger and healthier, on average, so when they are in health insurance pools overall premium costs are lower for everyone else.  Only 6% of those who have signed up for the new California health insurance speak Spanish as their first language.  While the March 31 deadline for coverage sign-ups is fast approaching, an overall improvement in marketing strategy will help Latinos and the health care industry as a whole.

Physical & Lifestyle Factors That Affect Health Insurance Costs

Thursday, November 28th, 2013

There are a lot of factors that go into determining health insurance premium costs.  They aren’t always easy for the average consumer to figure out, but Money Crashers has put together a list of the “10 Factors That Affect Your Health Insurance Premium Costs.”  Kira Botkin says that insurance companies first place a value on your risk profile, which is made up of information from your insurance application and your medical history.  Some things in your risk profile are under your control, while others are not.  Once the company does extensive research to determine your risk profile, they compare it with company benchmarks and decide whether they will offer you health insurance coverage.  Your premium is then determined based on your individual risk factors.

The first group of risk factors is that of the medical and physical variety, some of which you have full control over.  Number one is your BMI, or Body Mass Index.  People with a high BMI are almost always charged more for individual health insurance policies.  They have a higher risk for diseases like diabetes and heart disease and women with high BMI’s can have complicated pregnancies.  Whether or not you smoke or chew tobacco will affect the price of your health insurance.  Some companies deny you altogether, but many offer plans with higher premiums and cover the cost of programs to help you stop smoking if they are prescribed by a doctor.  Gender and age are the next two factors affecting your insurance premiums.  Women often pay more for health insurance because they go to the doctor more often, fill more prescriptions, and get more diseases on average.  Maternity costs are also very high for women of child bearing age.  Speaking of age, younger people often get lower health insurance premiums because they visit the doctor less and typically have fewer health conditions.

Pre-existing medical conditions have been in the news headlines a lot lately.  Many insurance companies wouldn’t even cover people with these pre-existing conditions until the Affordable Care Act started requiring insurers to do so.  Any pre-existing medical conditions like asthma or a cancer history will increase the cost of your insurance premiums.  Although you have no control over your family health history, family history does often play a role in the cost of your health insurance premiums.

The second group of risk factors pertain to your lifestyle and personal health.  Your job plays a part in determining your insurance premiums.  Those in very risky or dangerous jobs might be charged more because they could get injured.  Also, people who work in very sedentary jobs are often charged an increased premium because of their increased likelihood to develop cardiovascular disease.  Where you live can also affect how much you pay for health insurance.  If your area has more unhealthy people and a more sedentary lifestyle, you could pay more for insurance, even if you are healthy.  Married people pay less for health insurance than single people, on average.  Married couples are often healthier and live longer than unmarried people.  Finally, whether or not you have been uninsured in the past can affect your new health insurance premium.  If you were uninsured or are just now shopping for your own insurance policy, you will likely have a higher premium.

Be healthy and control the things that you can control in your lifestyle to give yourself the best chance at a lower health insurance premium.  Compare insurance companies and policies and do your homework before choosing an individual health insurance plan.  Some risk factors are out of your control, but take charge of those that are not.

Increase in Health Insurance Takes Bigger Bite from Paychecks

Thursday, August 22nd, 2013

I don’t think this comes as a surprise to anyone, but research confirms that health care costs are growing faster than wages.  The Kaiser Family Foundation and the Health Research & Education Trust found that employees pay 6% more for their health insurance than last year, which is three times higher than their increase in wages.  And that’s just the average.  I’m sure there are many people paying an even greater amount for their health insurance, not to mention those whose wages haven’t been increasing at all.  This is not to say that companies are being unfair however, because they are paying quite a lot more to cover their employees’ health care as well.  Compared to one decade ago, family health insurance premiums have increased by 89%.  Workers are paying $4,565 each year for their employer-sponsored health insurance, while individuals are paying around $1,000.  This information comes from CNN Money’s Tami Luhby in the article “Health insurance premiums rise faster than wages.”

Those amounts though are little in comparison to what the employers are paying.  Families are covering 28% of the total health care cost and individuals are paying only 17% of the cost.  The increase in total health care costs was around 4%, taking into account both the family or individual and employer share.  But overall wages only increased by 1.8% on average, so the health care increases take a bigger bite out of paychecks.  This study has been conducted yearly since 1999 and this year actually saw the second smallest increase in health care costs.  A slower economy is the biggest reason, but that is good news for employers and employees alike.  Employers have been trying to put more of their costs onto employees for awhile now though.  The amount of yearly deductibles as well as the number of companies making employees pay a deductible has been steadily increasing.

Something else that has become popular is offering wellness programs or discounts for employees who take steps to remain healthy.  More large companies implement these types of plans, but small companies do as well.  Companies with 50 or more workers will be required to offer health insurance plans starting next year.  But 93% of these companies are already offering health insurance to their employees.  When it comes to small employers, just over half of them are offering health insurance plans to workers.  Families at small companies pay a lot more than those at large companies for their health insurance, but the individuals at small companies actually pay less.  Individual health insurance exchanges popping up under the new health care law shouldn’t do much to change employer health insurance, unless the policies become more affordable to workers than remaining in their employer sponsored plans.

Employers Offer Health Insurance Discounts for Low Cholesterol, Non-Smoking

Wednesday, October 10th, 2012

According to Fox News’ “Is your boss watching your cholesterol?,” many companies are offering not only discounts for employees who stay healthy.  In some cases, they are also penalizing those who have poor health habits like smoking.  Some recent examples include receiving a $50 bonus if you go to a health screening, having your health insurance premiums lowered if you stop smoking, and receiving contributions to an HSA if you lower your weight or cholesterol.  If you work at Wal-Mart, you could be charged $10 every pay period for being a smoker.  Many may question the validity of these practices, but with health insurance costs through the roof, every little thing to keep employees healthier and deter unhealthy behavior adds up to savings on health care costs.

Last year, 54% of companies were offering some type of financial incentive for good health.  By this year, that number has climbed to 61% of employers offering some type of a plan.  One-fifth of companies are giving penalties for poor health decisions, a slight increase of 1% from last year.  One of the most shocking increases is for the amount of employers using actual statistics to measure employee health and offer their discounts.  Last year. only 4% were looking at statistics like BMI and blood pressure.  Twenty-five percent of companies are now using these biometric measurements, also for cholesterol and weight numbers.  While it’s in the best interest of everyone involved for employees to improve their health and lower health insurance costs for employers and insurance companies, some wonder if this is too much control over our lives.  There could be legal issues based on who is running the program and how well they keep it confidential.

Smoking is the biggest health issue being tackled by employers with their employees.  Thirty-five percent of companies offer discounts to non-smokers or free programs to help their employees stop smoking.  While most companies work on the honor system, it is simple to test employees for nicotine if they so desire.  Health insurance costs per employee average $11,664 each year in 2012.  That is up from $10,982 last year, but is expected to increase an average of 7% next year as well.  Wal-Mart contends that non-smokers’ health care costs are 25% less than those of smokers, so employers have a vested interest in employees’ health.  By encouraging employees to be healthier, you also can reduce the rate of absences and even increase productivity.  Companies are legally allowed to reward or penalize employees for up to a 20% difference in their health insurance premiums.