The Affordable Care Act (Obamacare) was pushed through in Congress partially based on the idea that people would be able to keep their current doctors. In theory, younger and healthier people would pay into the system by buying policies without using them, while older and sicker people’s costs would be offset by what the young, healthy people are paying. Then, as the young, healthy people grow older and become ill, new people would be paying into the system to offset their costs (and the cycle would continue).
Why are Healthcare Premiums Rising?
What was not discussed, although was clearly anticipated, was that with all of the new regulations forced onto the insurance companies by the Affordable Care Act, the insurance companies would then pass those added costs onto the policyholders.
For example, under the Affordable Care Act, insurance companies must have certain software, which caused them to have to not only purchase the software, but to train their existing employees on how to use the software or to hire additional employees. This is just one of many regulations the insurance companies face under Obamacare. Rather than bear the brunt of these costs themselves, insurance companies have raised their rates, causing the policyholders to bear the brunt of these costs.
What Do Rising Health Insurance Premiums Mean?
Long story short, insurance costs for the average policyholder are increasing anywhere between 18-50% per year. This, in turn, is forcing the policyholders to make adjustments – the only way for them to get a better premium at this point is to reduce the type of coverage they’re receiving. Higher copays, higher deductibles, and having to change doctors are some of the effects many Americans are seeing this year.
Whatever your political position, the reality is that health care premiums are rising for the average American because of the regulations placed on health insurance companies by the Affordable Care Act. The one particular promise of Obamacare, that everyone would be able to keep his or her current doctor, has so far failed to come through.
The Bottom Line
If you’re already struggling to afford healthcare, an injury or an accident can be all the more devastating. In the coming years, if health insurance premiums continue to rise, we may see more and more people turning to low-quality, low-coverage insurance plans in order to save money.
Stuart A. Carpey, who has been practicing as an attorney since 1987, focuses his practice on complex civil litigation which includes representing injured individuals in a vast array of personal injury cases.