Insurance industry experts warn of impending rate shock from higher rates in 2015
The issue of health insurance premiums rising in the U.S. as a result of the Affordable Care Act has received a great deal of attention over the past few years. According to the Department of Health and Human Services, rates will indeed increase in the coming year, but only by a modest amount. The agency suggests that the financial impact of new insurance regulations has not been sufficient enough to cause insurers to raise premiums by a significant margin. The insurance industry, however, suggests that rates are set to see a significant increase in the coming year.
Industry experts suggest that rates could grow by an average of 300% nationwide
According to experts in the insurance industry, premiums for health coverage could see a 300% increase in the coming year. Rate hikes coming from insurers throughout the country are expected to be a major political talking point in the coming months as certain figures prepare themselves for election campaigns in 2015. Industry experts note that how much premiums grow will depend heavily upon regional influences. Coverage in major cities is likely to become more expensive than that in non-metropolitan areas.
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Insurers suggest that new insurance regulations are leading to higher premiums
Many insurers had warned of rate increase due to the Affordable Care Act, but rate increases in 2013 have proven modest in most parts of the country. Insurers suggested that the federal health care law’s provisions would introduce costly changes to the way the insurance market operates. These changes would eventually translate into more expensive insurance coverage for consumers. This would cause what is referred to as “rate shock,” which is the increase of insurance costs that consumers may find difficult to manage.
HHS claims that any rate increases will be modest and manageable
The Department of Health and Human Services holds that any rate increases that will be seen in 2015 will be modest. Many state agencies have the authority to approve or deny rate increase proposals coming from insurance companies. Moreover, the federal government can also examine the merit of rate increase proposals that seek to raise rates by 10% or more.