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Health Care Premiums on the Rise. Again.

Despite the Obama administration’s ambitious health care overhaul, insurance premiums are on the rise.


The May 2011 medical index by consulting firm Milliman Inc. says health care costs for a family of four will rise 7.3% in 2011 to $19,393 for those insured through work, with employee out-of-pocket expenses up 9.2% this year versus 6.6% last year. “Trends in health care spending still far exceed most other goods and services,” it said.

Milliman’s researchers said that employees are paying around $8,000 of the total annual healthcare costs, higher than other areas of consumer spending, as employers offer health plans with higher deductibles, and co-insurance and co-payment limits to control costs and to encourage workers to use medical care more selectively. That includes $4,728 in an employee contribution and $3,280 in employee out-of-pocket costs.

Premiums are rising even faster in Massachusetts, even after that state introduced its own health care reform in 2006 requiring residents to buy health insurance in that state, according to Consumer Watchdog. Insurance premiums for a single plan have risen 13.4% nationally from 2006 to 2009 versus a much larger 18.4% in Massachusetts, while premiums for a family plan rose 19.8% in Massachusetts in the same period, versus 14.5% nationally.

Consumers are increasingly unable to afford the coverage they have, the report says: “Massachusetts is hard‐pressed to maintain affordability. Premiums in the state remain the second-­highest in the nation and rising costs are threatening to unbalance the state budget.” It adds, “The passage of the federal [healthcare] reform triggered further outsize increases by insurance companies apparently seeking to establish high base rates in advance of the law’s implementation.”

This echoes conclusions in a recent study in the American Journal of Medicine, which concluded that the percentage of personal bankruptcies related to medical bills or illness in Massachusetts hasn’t improved much since 2006. Medical bankruptcies as a percentage of personal bankruptcies eased only slightly to 52.9% from 59.3%.

A spokeswoman for the National Association of Health Underwriters says, “Even in a highly regulated market like Massachusetts, premiums continue to rise because consumers continue to treat health care as if it is a free service. If we are more aware of where we are spending our health care dollars, we can more effectively provide quality care for all Americans,” she says.

“Health insurance is expensive because health care is expensive,” the spokeswoman adds, citing a weaker economy putting pressure on employers to decrease contributions, a shortage of primary care physicians in rural areas, and insurance carriers pulling out of the individual market and discontinuing child-only policies.

What do you think is behind these rises?


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    • By WebOsPublisher

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      1980s Television Set icon
      by Adam Whitcroft
      Feb 14, 2012
      5 buckets
      13 Responses
      Adam Whitcroft
      I wanted to get in on the NES Icon Battle #1 but kinda missed the boat. I had already started on the television so thought why not finish it.
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      Dan Eden
      Yummy. That speaker grille is divine!
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      Daryl Ginn
      10 months ago
      Natalie Rooke
      I’m getting in on some icon battlin’ right now.
      10 months ago
      Todd Coleman
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      Joshua Hibbert
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      Yoga Perdana
      love it!
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      Dan Eden
      @Natalie Rooke yay!
      10 months ago
      Adam Whitcroft
      @Todd Coleman, @Joshua Hibbert, @Yoga Perdana thanks guys!
      10 months ago
      Tim Potter
      10 months ago
      Luke Jones
      This looks bad ass!
      10 months ago
      Adam Whitcroft
      @Tim Potter @Luke Jones Thanks chaps!
      10 months ago
      Joaquim Marques Nielsen
      Retro! Gotta love!
      9 months ago
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    • Nope, it doesn’t work quite that way.When you have an alarm system, or a mitnoored alarm, you get a discount on your homeowners policy, which is a PERCENTAGE of the base rate’. If you’re already getting a discount for deadbolts and smoke detectors, the discounts for protective devices don’t stack so you’ll get a bigger discount, but not BOTH. One, or the other.And the discounts are usually 10% to 15% depending on the alarm type, location, and insurance company. If you’re paying $300 for your insurance a year, you’re NOT going to get a $360 discount for having the alarm. Talk to YOUR AGENT, to get ACCURATE numbers for how much the discount would be, on YOUR policy.

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About Pay Dirt

  • Pay Dirt examines the millions of consumer decisions Americans make every day: What to buy, how much to pay, whether to rave or complain. Lead written by Quentin Fottrell, the blog examines these interactions, providing readers with news, insight and tips on shopping, spending, customer service, and companies that do right – and wrong – by their customers. Send items, questions and comments to quentin.fottrell@dowjones.com or tweet @SMPayDirt.