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Health insurance costs still a source of concern

Health Care and Health Insurance
by Cabe Chadick
Health insurance costs still a source of concern
Health insurance costs still a source of concern

Millions of Americans have gained broader access to health insurance as a result of the Patient Protection and Affordable Care Act, but costs continue to rise at least somewhat sharply for many of them. This is true almost regardless of how they get that insurance, whether it's through an employer, government program or via the individual marketplace.

As of the end of 2017, more than half of all Americans - 56 percent - had insurance through an employer, or the employer of a family member, and another 9 percent bought on the individual exchanges, according to the latest research from the Commonwealth Fund. On average, those people saw costs for coverage rise rapidly, by some $7,000 for individual in a number of states, and for family plans the increase was closer to $20,000.

Of course, employers or government subsidies picked up much of those costs, but they still hit workers' wallets, the report said. The average annual premium in 2017 made up 6.9 percent of workers' take-home pay, versus just 5.1 percent in 2008. And in 11 states across the country, premiums made up at least 8 percent of median incomes. Likewise, deductibles rose from 2.7 percent of median incomes to 4.8 percent over that same time period.

As a consequence, the average cost for both premiums and potential out-of-pocket expenditures ticked up to 11.7 percent of median income nationwide - nearly $7,250 - from the 7.8 percent seen 10 years earlier, the data showed.

The cost of coverage continues to rise.The cost of coverage continues to rise.

Where it's growing
As part of a broader look at how costs were rising, JPMorgan Chase recently found that people tend to pay the largest out-of-pocket medical expenses at hospitals and other types of outpatient facilities (such as labs) in 2017. At the same time, these expenditures actually declined at pharmacies for the third year in a row.

These two categories of out-of-pocket health spending grew 12 percent (for medical services, equipment and labs) and 8 percent (for hospitals), the data showed. That dramatically outpaced spending increases for doctor's visits (up 5.4 percent), dental treatments (4.8 percent), chiropractors (4.1 percent) and vision care specialists (2.3 percent). Meanwhile, drug spending slipped 5.1 percent.

What to keep in mind
However, it's worth noting that many of those numbers are averages, meaning that while some people have seen their cost increases stay relatively muted even as national averages spiked, others have seen their health insurance expenditures skyrocket, according to The Washington Post. Anecdotally, people have reported seeing their premiums rise 30 percent or more in a single year, depending upon where they live and what kind of insurance they have.

Typical premiums for coverage purchased on the individual exchanges have risen 75 percent or more in many places since the marketplaces first opened in 2014, meaning that's a sizable increase on an average annual basis, the Post noted. One recent poll found that nearly 1 in 3 Americans now think their health care costs overtake their ability to cover other basic necessities.

What's the impact?
While many people will choose to "grin and bear it" with their high health care costs, largely due to the unattractive alternative of going without coverage, the fact is that it's leading many parents to make hard decisions, according to new research from the Georgetown University Health Policy Institute Center for Children and Families. From 2016 to 2017, the number of kids who were covered by health insurance slipped, with an additional 276,000 children going without coverage, and three-quarters of those young people live in states where government officials chose not to expand Medicaid.

When health insurers are able to offer low-cost policies as a means of ensuring people continue to carry at least some type of coverage, all involved are likely to be better off.



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