Health insurance cancellations may not actually be a costly problem
Families USA, a health care advocacy group, has released a new study that focuses on the costs associated with the Affordable Care Act. Recently, the health care reform law has received harsh criticism due to insurance companies cancelling certain policies. According to the federal law, insurers must cancel health insurance policies that do not comply with the standards of the Affordable Care Act. Critics of this provision suggest that consumers are being forced to purchase new policies that are vastly more expensive than their substandard policies, but this may not actually be the case.
Study highlights financial implications of policy cancellations
According to the study from Families USA, approximately 0.6% of people below the age of 65 are currently at risk of having to pay more for health insurance policies that adhere to the standards of the Affordable Care Act. The study accounts for approximately 65 million non-elderly individuals that have pre-existing health issues. These people represent a relatively costly risk for health insurance companies and, as such, typically experience higher health insurance costs when compared to those without pre-existing conditions.
Number of people paying more for coverage considered significant
While the study suggests that the number of people that will have to pay more for health insurance is small, Families USA does note that the estimated 1.5 million people having to spend more money on their coverage is not a trivial matter. For those paying more for coverage, new health insurance policies could represent a new and significantly more difficult to manage financial issue. Many of these people may also not benefit from a recent decision from the Obama Administration concerning the cancelation of health insurance policies.
Insurers to determine whether policies continue or remain canceled
Earlier this month, President Obama announced that health insurance companies would not be required to cancel substandard policies until 2015, at the earliest. Unfortunately, whether insurers adhere to this measure depends on how much autonomy they have in the states in which they operate. In some states, the matter will be settled by insurance regulators. In others, however, insurers will have to decide whether they will cancel substandard policies or not.