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The Simple Truth About Health Insurance Plan Rates

Posted by Andrew Day on Mon, Oct 17, 2011 @ 11:36 AM

Health Insurance Plan Rates Simple Truths

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A few simple truths become obvious from tracking and trending different health insurance plan rates over the course of the last few years.

  1. Health insurance rates are increasing across the industry.
  2. Health insurance coverage has not changed much.  However, they will over the next few years.

There are plenty of conclusions that can be drawn from these two distinct facts.  However, many conclusions are partial, circumstantial, and/or are based upon a preconceived notion and some are VERY politically driven.  Many without merit or substance.

The following statements are commonly voiced.  Unfortunately, when taken individually thay are not necessarily true.

    • Health insurance companies are greedy. (opinionated and political).
    • Health insurance companies are anticipating increases in costs due to increased regulations forcing them to add coverage. (preexisting conditions increased risk for the insurer)
    • Costs of goods and services are increasing at the doctor or hospital level, therefore insurance rates must increase.

Believe it or not, health insurance plan rates are not increased on a whim and insurance plan rate changes are regulated.

Every state has a department of insurance.  The purpose of the department is to review and approve changes to health insurance plans sold to the consumer (at the insurance company’s expense).  If the department finds an increase to be unjustified, or unlawful, they have the power to reject those plans from being sold.

Undoubtedly, there is a problem with the cost of health insurance plan rates.  There are multiple factors contributing to increases in rates.

Pretending that there is only one negative force contributing to the rising cost of health insurance plan rates is simply naïve.

Tags: Health Insurance