Report shows the rising cost of insurance coverage in the US
The American Association for Long-Term Care Insurance, an industry trade group, has released a new report concerning the rising cost of this type of coverage. Long-term care insurance can be used to cover the cost of medical care in a home or a nursing home. This coverage is meant to offset the cost of medical and care services that are offered to those with prolonged illnesses and chronic disorders. This coverage is somewhat common, but many people do not have long-term care insurance because they do not need it.
Average premium for long-term care insurance coverage has increased by 9%
According to the report, the average cost of long-term care insurance has grown by 9%. The report notes that rates vary greatly depending on the insurer offering this coverage and the types of benefits policies provide. The report shows that insurance rates may be growing because of higher claims costs. In 2014, insurers offering long-term care coverage paid out $7.8 billion in claims, which is 5% more than claims payouts reported in 2013.
Using gender to price insurance coverage is receiving harsh criticism
In order to recover from loses seen in the past year, insurers have begun increasing premiums. Losses are not the only thing that affect insurance premiums, however. Gender also plays a role in determining the cost of insurance coverage. This became an issue last year when the National Women’s Law Center filed federal complaints against insurers that used gender as a factor to price insurance coverage. These complaints argued that using gender in this way violated the provisions of the Affordable Care Act.
Insurance premiums will likely continue growing at a modest pace
Though insurance premiums for long-term care coverage have grown by a significant margin in some states, premiums remain modest. The report notes that older policies, even those that experienced a major increase in premiums, are still less expensive than those that would have been purchased today. Insurance premiums are expected to continue rising, though at a relatively modest rate.