Top insurers to raise rates, add exclusions
A top insurer will raise premiums for some of its most popular policies by an average of 14%, according to a survey by the American Medical Association.
The AHA’s survey, released Wednesday, comes after insurers announced their latest increases.
It’s the latest indication that insurers are beginning to adjust to a new business climate that is changing the way they do business, particularly in the health insurance sector, which has been under fire for raising prices and limiting coverage.
Insurers say they need to continue to protect patients and insurers need to stay ahead of emerging new technologies, such as technology that could dramatically reduce out-of-pocket costs.
The industry has been grappling with the fallout from the Affordable Care Act, which is expected to provide $500 billion in tax credits to low-income Americans to help them buy health insurance, a policy that was widely criticized.
The ACA is set to expire at the end of March, but insurers say they will continue offering coverage until then.
They are already planning for the new insurance marketplace that is expected by 2019.
Insurance companies have raised rates by as much as 9% for individual policies and 8% for family policies, according to the survey.
The average increase for the average individual policy was $3,600, the AHA said.
The average increase in family policies was $6,600.
The survey was conducted among more than 2,000 health insurers in June.
The AHA does not disclose the margin of error.
In addition to its average increase, insurers said they will be raising their deductibles and coinsurance policies by as little as 3% and 1%, respectively.
The Affordable Care Amendment will be considered by Congress at the beginning of the new year, and insurers are considering a range of options, such a lowering premiums and raising the number of coinsurance plans.
Insurer representatives told Reuters they will have to make decisions over the coming months.
“There are a number of ways we’re going to handle this, but we’re looking at all of them,” said Michael O’Brien, an AHA vice president for health policy.
Insured consumers will see higher deductibles for the first time.
Consumers have long complained that deductibles are too high for them and the law will help pay for higher premiums for many consumers.
The law also includes a new tax credit of up to $2,500 for low- to moderate-income families to help with health insurance costs.
O’Brien said the law is helping lower deductibles, but he added that he expects the rate increases to be even larger.