Personal medical insurance premiums in the United States may rise by 30% next year

Personal medical insurance premiums in the United States may increase by 30% next year. Aetna Group, headquartered in Hartford, Connecticut, is the third largest insurance company in the United States. (Photo source: Associated Press) […

Aetna Group, headquartered in Hartford, Connecticut, is the third largest insurance company in the United States. (Photo source: Associated Press)

[Qiaobao Comprehensive News] Covered California, the health insurance exchange market established by the California government to cooperate with the implementation of the Obamacare law, issued an analysis report on Thursday saying that in 2019, people across the United States who purchase health insurance through the government health insurance market may see premiums increase by 22% to 32%. Experts point out that the repeal of the provisions of the Obamacare law in the tax reform bill last year that forced people to purchase medical insurance will cause individual medical insurance costs to rise by 7% to 15% in 2019. In addition, the rising trend of medical costs will push medical insurance costs up by 7%.

According to the San Francisco Chronicle website, the "California Covered" market provides health insurance shopping services for the 1.2 million residents of the state who do not receive health insurance from their employers. It did not list specific figures for the increase in California's health care costs. However, before it released the report, an analysis released last month by the Urban Institute estimated that health care costs in California will rise 18% in 2019.

Peter Lee, director of Covered California, said: "Consumers will see notifications of increases in their health insurance costs in January next year in September and October."

The latest analysis report predicts that health insurance costs will continue to rise in the next two years. By 2021, California will be one of 15 states in the United States where health insurance costs will rise by about 35% compared to current health care costs. Since California has the lowest proportion of residents with chronic diseases and the highest proportion of healthy people entering the individual health insurance market, the increase in health insurance costs in the state is still within a relatively low range.

In the next three years, medical insurance costs may rise by more than 50% in 19 states across the United States, and 17 states may see medical insurance costs rise by more than 90%.

Such a sharp increase in medical insurance costs mainly applies to the approximately 10 million residents in the United States who receive government premium subsidies and the 6 million who do not receive subsidies. The first group of people may be partially protected because the increase in their medical insurance costs may be offset by the increase in subsidies they receive, while the latter group of people will be hit hard.

Since the "California Covered" market began operating in 2014, medical insurance costs increased by 4% in each of the first two years, but increased by 13% and 12.5% ​​in 2017 and 2018 respectively.

Health insurance premiums are expected to rise in part due to rising medical spending, and the uncertainty Congress and the White House have injected into the insurance market since 2017 has undoubtedly added fuel to that trend. The Affordable Care Act (commonly known as Obamacare) introduced during the Obama administration stipulates that individuals must purchase health insurance, otherwise they will be fined. That provision will expire in 2019 because the tax reform bill passed by Congress in December repealed it.

"California Covered" market actuary and author of the analysis report, John Bertko, pointed out that by 2019, the abolition of the mandatory clause that individuals must purchase medical insurance will cause medical insurance costs to increase by 7% to 15%, and the trend of increasing medical expenses will cause annual medical insurance costs to rise by 7%.

>The Trump administration has recently relaxed regulations on cheaper health insurance plans with less coverage. Experts predict that this will divide the individual health insurance market into two parts: healthy people will switch to lower-priced health insurance plans with less coverage, while sick people will have to pay higher health insurance premiums because they need health insurance plans with greater coverage.

The clause that forces people to buy medical insurance is the cornerstone of the Obamacare law. The principle is that if everyone buys medical insurance, the premiums paid by young and healthy people can be used to subsidize the elderly and sick people, so that the latter can spend less and see more doctors. After this provision is repealed, many young and healthy people may no longer be insured, and insurance companies will inevitably see less revenue, so they will have to increase premiums to maintain normal operations.

(Editor: Hu Yutong)