Healthcare Costs Rising

Many Americans may pay more for their health insurance after the Afford Care Act takes full effect in January 2014. Many of the country’s biggest health insurance providers say that premiums could increase anywhere from 20 percent to 100 percent because of the sweeping changes to the healthcare system and the increase number of people who will have insurance.

The cost increases won’t be uniform for all Americans, as some may see their rates go down. But for workers who purchase private health insurance plans and don’t receive insurance from their employers, the cost increase could be substantial. Nearly 14 million Americans currently fit into this group, and most are self-employed or work as independent contractors who don’t receive health insurance from a traditional employer.

Premiums may change because of how the insurance companies charge based on age and gender. In addition, taxes on premiums will also increase costs by up to 2.3 percent. A requirement for how much insurance companies are required to pay on patients’ medical bills, prescriptions, and treatments could also affect the increase in premiums.

Overall though, proponents of the Affordable Care Act say that because more people will pay into the system, costs will decrease as a whole. But for insured people in certain, the costs will almost certainly be higher. For example, young people who utilize low-cost coverage may see their premiums increase significantly, while older people and those on Medicare may see smaller increases or even a reduction in costs.

However, the law will make it much easier for people with preexisting conditions to get insurance if they lose their jobs or never had insurance before. Previously, insurance companies could deny sick people the coverage they needed, or even drop their coverage altogether if they needed expensive treatments that their insurer didn’t want to pay.

The law also has provisions for young people who are healthy and don’t need regular medical care. They can purchase plans that only cover catastrophic illnesses or injuries. Because they will rarely utilize emergency or medical services, their premiums may stay on the low end. Another aspect of the law, which has already taken effect, allows young people to stay on their parent’s insurance plans until age 26.

Another goal for the Affordable Care Act is to introduce competition into the healthcare marketplace between insurance companies, which proponents hope will help drive prices down to the benefit of all Americans.