Next year, health insurance rates are expected to see their first significant rise since the passing of the Affordable Care Act. On average, insurance rates are expected to rise 10% in the upcoming year. Most of the burden will fall on higher-income Americans who do not qualify for government subsidies and people who pay out of pocket for services (Sanger-Katz, 2016).
Reasons for the increase cost of insurance premiums are the rising cost of medical care, changes in healthcare law, and under-billing by insurers. The first cause of an increase is that medical care costs simply rise every year. This should be of no surprise to people, since insurance premiums historically rise yearly (Sanger-Katz, 2016). The increase is caused by advances in medical care, such as the development of new drugs by pharmaceutical companies and new technological advances in medical treatments. Also, hospitals stays are becoming more expensive and contribute to a large portion of increased costs. …show more content…
There is a special healthcare law that is contained within the Affordable Healthcare Act, that law included protection for insurance companies who made miscalculations in setting prices. The Reinsurance, Risk Corridor and Risk Adjustments is the law that expires at the end of 2016 (CMS). These programs offered protection to the insurers who did not take into account just how sick some of their patients were and how expensive their care would be. Therefore, the expiration of this law will lead to increased risk and increased
Reasons for the increase cost of insurance premiums are the rising cost of medical care, changes in healthcare law, and under-billing by insurers. The first cause of an increase is that medical care costs simply rise every year. This should be of no surprise to people, since insurance premiums historically rise yearly (Sanger-Katz, 2016). The increase is caused by advances in medical care, such as the development of new drugs by pharmaceutical companies and new technological advances in medical treatments. Also, hospitals stays are becoming more expensive and contribute to a large portion of increased costs. …show more content…
There is a special healthcare law that is contained within the Affordable Healthcare Act, that law included protection for insurance companies who made miscalculations in setting prices. The Reinsurance, Risk Corridor and Risk Adjustments is the law that expires at the end of 2016 (CMS). These programs offered protection to the insurers who did not take into account just how sick some of their patients were and how expensive their care would be. Therefore, the expiration of this law will lead to increased risk and increased