Health care reform may not be the sole cause of rate increases
The Commonwealth Fund has released a report that shows that health insurance premiums throughout the U.S. were on the rise well before the implementation of the Affordable Care Act. The federal health care reform law has been the subject of extreme criticism for the past few years, with those opposing the law claiming that it is the cause of significant rate increases in insurance coverage. This may not be accurate, however, as insurance policies were already becoming more expensive before the law was ever passed.
Insurance policies were growing more expensive every year before health care reform
The report shows that premiums grew by an average of 10% every year nationwide from 2008 to 2010. Sine states experienced more rapid rate growth than others, largely dependent on the losses that insurance companies had faced in the year previous to the rate increase. The report shows that there is no significant geographic pattern concerning rate increases, but states where medical care is quite expensive saw larger increases than others.
Health care reform may eventually lead to higher insurance premiums
While insurance rates have been growing for some time, there are those that suggest that rates will grow at an accelerated rate due to the health care reform law. This is difficult to determine for certain due to the fact that many of the law’s provisions have only just been implemented. Health insurance premiums are expected to become more costly in the coming year, but are not expected to increase by a significant margin. Coverage is likely to be more expensive in the private market, which may encourage more people to purchase coverage through state-based exchanges.
Cost of medical care directly affects the cost of insurance coverage
Insurers are being required to adhere to federal standards with the insurance policies they offer. All policies must provide coverage for a wide range of medical issues, including mental illness, and this could become an expensive issue for many insurance providers. The increasing cost of medical care is linked to the growth of premiums, so without addressing the issue of expensive medical care the cost of insurance coverage may be a problem without a resolution.