Health insurance: premiums stabilized despite nursing care

The health insurance industry could experience a ‘hangover’ from COVID-19 in 2022, as consumers who postponed elective treatment during the pandemic return to doctors.

That was a prediction from the PwC Health Research Institute, which predicted an increase in employer medical costs of 6.5% in 2022, slightly lower than in 2021 and greater than the period from 2016 to 2020.

Consumers who received deferred care during the pandemic, along with the ongoing costs of COVID-19 treatment, increased mental health and addiction issues, and poor health behaviors during the pandemic are contributing to this increase in spending. .

However, in the individual market, most carriers participating in the Affordable Care Act markets have assumed that COVID-19 will have no effect on their 2022 costs, according to tariff filings.

The Kaiser Family Foundation reported that of the 311 rate deposits reviewed, 272 plans had a premium change for 2022. The rate changes from 2021 to 2022 range from a 28.5% drop to a 25.6% increase. %, although half fell between a drop of 1.8% and a drop of 6.2% increase.

The four consecutive years of declining premiums in the personal market is good news for consumers, said Matt Eyles, president and CEO of America’s Health Insurance Plans.

“For next year, we expect a further drop in premiums for market plans,” he said. “When we looked at the data, we see that the average premium for the typical benchmark money plan will drop by about 3% over the next year. And about 80% of individual consumers who buy coverage on their own are expected to be able to find coverage for $ 10 or less per month, due to enhanced premium subsidies under the US bailout.

Falling premium costs are a sign that the ACA market is moving towards stability after its turbulent early years, he said.

Additionally, consumers have more operators to choose from in the ACA area, and some operators have extended their coverage areas for 2022.

“I think the story of the individual market is that after several years of trying to figure out what the market would look like, and then some of the changes that we had seen under the previous administration, we now continue to see the market mature,” Eyles said. “As more carriers come into the market, part of that I think is a reflection of their belief that the future is good and now is the right time. to make that investment. ”

On the employer side, Medicare and related benefits are more crucial than ever in attracting and retaining workers as the war for talent escalates over the coming year, he said.

COVID-19 and the new normal

COVID-19 has forced the health insurance industry to adapt, and some of those changes will become more the norm over the coming year, Eyles said. He cited the growing use of telehealth services as an example.

“We have really made such a shift to virtual care,” he said. “And we know a lot of in-person care has picked up. But I think we’re all trying to figure out, in the longer term, what that balance and that combination of in-person and telehealth will be. I think the pandemic has shown how important telehealth services are, especially in some areas, not only for getting treatment and diagnosis for acute conditions, but also for things like treatments and health services. mental. “

The expansion of government health care

A growing number of Americans are receiving their health care through government programs.

Since 2017, the percentage of members of managed care organizations who receive care through Medicare or Medicaid has increased from 31% to 41%, according to statistics from Florida Blue. Medicaid currently accounts for 25% of the MCO makeup, while Medicare accounts for 16%.

Meanwhile, self-funded commercial insurance makes up the biggest slice of the pie at 43%, although that share fell from 50% in 2017. Private commercial insurance accounts for 16% of the mix, down slightly from at 19% in 2017.

President Joe Biden campaigned on a healthcare platform that would expand Medicaid, lower the age of Medicare eligibility, and establish a public option. So far none of these have come true. But what about in 2022? Eyles was skeptical.

“I think the message is clear that we have to build and improve what we have, and I think we are optimistic that people will recognize that this is still the best way to go in the long run,” he said. declared.

But he also said much of the expansion in government health care could come at the state level. Several states are exploring their own public options.

Social determinants of health

The terms “health equity” and “social determinants of health” have become buzzwords over the past year or so. Health insurers will pay more attention to these factors in the coming year, Eyles said.

“Health insurers are committed to tackling inequalities in health, and in particular the underlying social factors,” he said. “I think this will continue to be important in 2022. We are also focusing on the cost and price of prescription drugs, which take up a large chunk of the health premium dollar.”

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